CASE 0:20-cv-00358-ECT-HB Document 38 Filed 08/07/20 Page 1 of 16
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`UNITED STATES DISTRICT COURT
`DISTRICT OF MINNESOTA
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`Oxygenator Water Technologies, Inc.,
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`Plaintiff,
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`v.
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`Tennant Company
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`Defendant.
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`File No. 20-cv-358 (ECT/HB)
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`OPINION AND ORDER
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`Aaron W. Pederson, J. Derek Vandenburgh, Nathan Louwagie and Philip P. Caspers,
`Carlson, Caspers, Vandenburgh & Lindquist, P.A., Minneapolis, MN, for Plaintiff
`Oxygenator Water Technologies, Inc.
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`Cara S. Donels and Robert Scott Johnson, Fredrikson & Byron, PA, Des Moines, IA and
`Lora Mitchell Friedemann, Fredrikson & Byron PA, Minneapolis, MN, for Defendant
`Tennant Company.
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`Plaintiff Oxygenator Water Technologies, a Minnesota corporation, owns several
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`patents on flow-through oxygenators and methods of oxygenating flowing water.
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`Defendant Tennant Company, also a Minnesota corporation, manufactures and sells
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`commercial floor scrubbers. Some of Tennant’s scrubbers are equipped with ec-H20TM
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`electrolysis modules, which, according to Tennant, facilitate cleaning through the creation
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`of microscopic bubbles in water without the use of floor cleaning chemicals. In this patent
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`infringement case, Oxygenator alleges that Tennant’s ec-H2OTM electrolysis modules use
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`Oxygenator’s patented technology, and Oxygenator asserts claims of direct, indirect, and
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`willful infringement of three patents. Tennant has filed a partial motion to dismiss,
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`CASE 0:20-cv-00358-ECT-HB Document 38 Filed 08/07/20 Page 2 of 16
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`pursuant to Federal Rule of Civil Procedure 12(b)(6), seeking dismissal of: (1)
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`Oxygenator’s claims of direct infringement based on Tennant’s manufacturing and sale of
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`its products; (2) Oxygenator’s allegations of pre-notification indirect infringement in
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`counts 1 through 4; (3) Oxygenator’s allegation of willful infringement and corresponding
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`request for pre-notification enhanced damages in count 5; and (4) Oxygenator’s request for
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`permanent injunctive relief. Tennant’s motion will be denied.
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`I
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`This case concerns Tennant’s alleged infringement of three patents owned by
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`Oxygenator—U.S. Patent Nos. RE45,415 (“the ’415 patent), RE47,092 (“the ’092 patent”),
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`and RE47,665 (“the ’665 patent”) (collectively, “the patents-in-suit”). See Am. Compl.,
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`Exs. A–C [ECF Nos. 9-1–9-3]. The history and issue dates of the patents-in-suit, rather
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`than the claims contained therein, are most relevant to Tennant’s motion. In 2003, Aqua
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`Innovations, Inc., a research and development company, applied for a patent on its flow-
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`through oxygenators and methods of oxygenating flowing water. Am. Compl. ¶ 9 [ECF
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`No. 9]. The application was granted and U.S. Patent No. 6,689,262 (“the ’262 patent”)
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`was
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`issued
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`to Aqua
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`Innovations on February 10, 2004.
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` See
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`id.;
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`http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&p=1&u=%2Fne
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`tahtml%2FPTO%2Fsearch-bool.html&r=1&f=G&l=50&co1=AND&d=PTXT&s1=6,689
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`,262.PN.&OS=PN/6,689,262&RS=PN/6,689,262. The ’262 patent is the parent patent to
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`the three patents-in-suit. See Am. Compl., Exs. A–C. In 2008, Oxygenator “was formed
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`to commercialize” the technology created by Aqua Innovations, and Aqua Innovations
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`assigned its patent rights to Oxygenator on August 8, 2008. Id. ¶ 10. A pending application
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`2
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`for another patent also was assigned to Oxygenator, and that patent, U.S. Patent No.
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`7,670,495 (“the ’495 patent”), was issued on March 2, 2010. Louwagie Decl., Ex. 1 [ECF
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`No. 22-1]. Each of the patents-in-suit is a reissue of the ’495 patent. Am. Compl., Exs.
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`A–C; see Mem. in Supp. at 2 [ECF No. 13]. The ’415 patent was issued on March 17,
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`2015, the ’092 patent was issued on October 23, 2018, and the ’665 patent was issued on
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`October 29, 2019. Am. Compl., Exs. A–C.
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`Tennant’s alleged awareness of Oxygenator’s patents dates to January 19, 2007,
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`when Tennant applied for its own patent (which was ultimately granted) for a “method and
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`apparatus for generating, applying, and neutralizing an electrochemically activated liquid.”
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`Louwagie Decl., Ex. 2 [ECF No. 22-2]. In its application, Tennant explained that part of
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`its apparatus, a sparging device, “include[d] a commercially available oxygenator . . . . For
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`example, oxygenator can include the OXYGENATOR Bait Keeper available from Aqua
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`Innovation, Inc. of Bloomington, Minn., which is described in more detail in Senkiw U.S.
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`Pat. No. 6,689,262.” Id. at 19:43–49. Tennant provided no other examples of oxygenators.
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`See id. In 2008, Tennant began equipping many of its commercial floor scrubbers with ec-
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`H20TM electrolysis modules for oxygenating water and selling them as a “green” alternative
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`to other scrubbers that required the use of chemicals. Am. Compl. ¶¶ 13, 20, 22. Tennant
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`purchases the electrolysis modules from a third party. Mem. in Supp. at 3.
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`In 2010, Oxygenator approached Tennant with an offer to license its technology.
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`Am. Compl. ¶ 26. On July 27, 2010, representatives from Oxygenator met with Tennant’s
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`General Counsel and Director of Global Technology and Advanced Products. Id. After
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`the meeting, Oxygenator emailed Tennant information about its technology and included
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`an attachment referencing “3 issued U.S. patents, 5 utility patent applications, and 10
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`provisional applications.” Id. ¶ 27. The attachment included links to the three issued
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`patents (the ’262 parent patent, the ’495 patent, and one other) and three published patent
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`applications. Id. One week later, Oxygenator issued a press release advertising an
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`exclusive opportunity to license its patented technology for use in cleaning and sanitization.
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`Id. ¶ 28, Ex. J [ECF No. 9-10]. The press release stated that Oxygenator would be accepting
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`inquiries and offers until September 17, 2010. Id., Ex. J. Oxygenator sent the press release
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`to members of Tennant’s management team. Id. ¶ 28. The Parties continued to exchange
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`emails, but, on September 2, Tennant informed Oxygenator that it would not bid on its
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`technology. Id. ¶ 29; Mem. in Opp’n at 6 [ECF No. 21]. One month later, Oxygenator
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`provided license pricing information to Tennant, and Tennant again declined to license
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`Oxygenator’s technology. Am. Compl. ¶ 29.
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`Oxygenator next communicated with Tennant on September 20, 2019, when
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`Oxygenator’s counsel sent Tennant’s Senior Vice President and General Counsel a letter
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`informing them that Tennant was infringing on the ’415 and ’092 patents and on allowed
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`claims in its forthcoming ’665 patent, for which Oxygenator had paid the issue fee.
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`Id. ¶¶ 53, 78, 105, 123; Louwagie Decl., Ex. 3 [ECF No. 22-3]. After Tennant did not
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`respond, Oxygenator commenced this lawsuit. ECF No. 1; Mem. in Supp. at 4.
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`Oxygenator asserts five claims in its amended complaint: direct and indirect infringement
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`of the ’415 patent (cylindrical electrode products) (Count 1); direct and indirect
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`infringement of the ’415 patent (plate electrode products) (Count 2); direct and indirect
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`infringement of the ’092 patent (Count 3); direct and indirect infringement of the ’665
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`4
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`patent (Count 4); and willful infringement (Count 5). Am. Compl. ¶¶ 32–129. Oxygenator
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`seeks a judgment of infringement; damages, including enhanced damages for willful
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`infringement; a permanent injunction against Tennant prohibiting infringement of the ’415,
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`’092, and ’665 patents; and costs and attorneys’ fees. Id. at 58–59, ¶¶ A–E.
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`II
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`In reviewing a motion to dismiss for failure to state a claim under Rule 12(b)(6), a
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`court must accept as true all of the factual allegations in the complaint and draw all
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`reasonable inferences in the plaintiff’s favor. Gorog v. Best Buy Co., 760 F.3d 787, 792
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`(8th Cir. 2014) (citation omitted). Although the factual allegations need not be detailed,
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`they must be sufficient to “raise a right to relief above the speculative level . . . .” Bell Atl.
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`Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citation omitted). The complaint must “state
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`a claim to relief that is plausible on its face.” Id. at 570. “A claim has facial plausibility
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`when the plaintiff pleads factual content that allows the court to draw the reasonable
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`inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal,
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`556 U.S. 662, 678 (2009).
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`A
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`Tennant argues that Oxygenator’s allegations of direct infringement based on
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`Tennant’s “manufacture” and “sale” of its ec-H20TM products should be dismissed because
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`these allegations are “contrary to black letter law.” Reply Mem. at 2 [ECF No. 24].1
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`Tennant did not seek dismissal of this aspect of Oxygenator’s claims in its motion
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`[ECF No. 12] but first made this request in its reply brief. In its opening brief, Tennant
`explained that it understood Oxygenator’s direct infringement claims to be limited to
`Tennant’s use of the electrolysis feature in its products for testing, demonstrations,
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`Tennant’s argument seems straightforward. Tennant points out that, “[t]o infringe a
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`method claim, a person must have practiced all steps of the claimed method.” Finjan, Inc.
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`v. Secure Computing Corp., 626 F.3d 1197, 1206 (Fed. Cir. 2010) (quotation omitted); see
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`Limelight Networks, Inc. v. Akamai Techs., Inc., 572 U.S. 915, 921 (2014) (“A method
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`patent claims a number of steps; under the Court’s case law, the patent is not infringed
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`unless all the steps are carried out.”). And it stands to reason that, because Tennant
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`purchases the electrolysis modules from a third party, the manufacture (or assembly) and
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`selling of ec-H20TM-equipped floor scrubbers would not necessarily require Tennant to
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`practice all steps of the electrolysis methods claimed in the patents-in-suit. To put it
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`another way, Tennant need not use the ec-H20TM-equipped floor scrubbers to manufacture
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`or sell them.
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`Tennant has a point, but that point does not warrant granting this aspect of its
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`motion. That Tennant need not practice all steps of the claimed method to manufacture or
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`sell its ec-H20TM-equipped floor scrubbers doesn’t necessarily mean that Tennant does not
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`servicing, or reconditioning. Mem. in Supp. at 5; see Friedemann Decl. ¶ 3 [ECF No. 14].
`Tennant understood Oxygenator to have abandoned “any claim that Tennant is directly
`infringing method claims in the Patents in Suit by manufacturing or selling the accused
`products.” Mem. in Supp. at 5. However, in its response, Oxygenator disputed Tennant’s
`understanding, denying it had abandoned any claim and pointing out that it had, in fact,
`added specific allegations regarding direct infringement in its amended complaint. Mem.
`in Opp’n at 9 n.4. In its reply brief, Tennant described Oxygenator’s position as an “about-
`face” and argued that any claims against Tennant “for direct infringement of method claims
`based on the manufacture and sale of floor scrubbers to third parties” should be dismissed
`under Rule 12(b)(6). Reply Mem. at 2–3. Under Local Rule 7.1(c)(3)(B), “[a] reply
`memorandum must not raise new grounds for relief or present matters that do not relate to
`the opposing party’s response.” However, because Tennant referenced this issue (or “non-
`issue,” as it then believed) in its opening brief and Tennant’s argument in its reply brief
`concerns Oxygenator’s response, it is appropriate to consider Tennant’s argument.
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`practice all steps of the claimed method during its manufacturing and sales activities. Of
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`course, this observation describes only what is possible, but Oxygenator’s complaint
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`“nudge[s] [its] claims across the line from conceivable to plausible[.]” Twombly, 550 U.S.
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`at 570. Oxygenator alleges that “common manufacturing practice suggests that Tennant
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`tests at least some of its products to confirm they work as intended before they are sent to
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`their customers” and that Tennant’s sales process “relies heavily on Tennant demonstrating
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`its equipment to potential customers.” Am. Compl. ¶¶ 34, 49–50, 74–75, 85, 98–99, 109,
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`122. With respect to Tennant’s sales process, Oxygenator also alleges that “Tennant’s
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`website is littered with buttons inviting a website visitor to ‘REQUEST A FREE DEMO’
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`of [its] scrubbers[.]” Id. ¶ 50. In other words, Oxygenator pleads plausible direct
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`infringement claims based on allegations that Tennant uses the accused product—that is,
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`practices all steps of the claimed method—in testing and demonstrations that occur
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`occasionally as part of Tennant’s manufacturing and sales processes. No authority is cited
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`to support the proposition that Oxygenator’s direct infringement claims fail because they
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`do not implicate the manufacture or sale of every accused product.
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`B
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`Tennant also seeks dismissal of Oxygenator’s allegations of pre-notification indirect
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`infringement in counts 1 through 4, and Oxygenator’s allegation of willful infringement
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`and corresponding request for pre-notification enhanced damages in Count 5, arguing that
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`Oxygenator has not plausibly alleged that Tennant had the requisite knowledge of the
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`patents-in-suit prior to Oxygenator’s September 2019 letter, or, in the case of the ’665
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`patent, prior to the filing of this lawsuit, and, therefore, cannot recover pre-notification
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`damages. Mem. in Supp. at 8–13; Reply Mem. at 3–5.
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`A patent may be infringed indirectly through inducing or contributing to a third
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`party’s direct infringement. See 35 U.S.C. §§ 271(b), (c). “Both induced and contributory
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`infringement require knowledge of the patent at issue.” Regents of the Univ. of Minn. v.
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`AT&T Mobility LLC, 135 F. Supp. 3d 1000, 1010 (D. Minn. 2015); see Global-Tech
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`Appliances, Inc. v. SEB S.A., 563 U.S. 754, 755–56 (2011). To prove a claim for induced
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`infringement, a plaintiff must show (1) an act of direct infringement by a third party, and
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`(2) that the defendant knowingly induced the infringement with the specific intent to
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`encourage the third party’s infringement. Omega Patents, LLC v. CalAmp Corp., 920 F.3d
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`1337, 1349 (Fed. Cir. 2019). The intent element requires a showing that “the defendant
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`knew of the patent and that ‘the induced acts constitute patent infringement.’” Commil
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`USA, LLC v. Cisco Sys., Inc., 575 U.S. _, 135 S. Ct. 1920, 1926 (2015) (quoting Global-
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`Tech Appliances, 563 U.S. at 755–56); see Vita-Mix Corp. v. Basic Holding, Inc., 581 F.3d
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`1317, 1328 (Fed. Cir. 2009) (stating plaintiff must show “that the alleged infringer knew
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`of the patent, knowingly induced the infringing acts, and possessed a specific intent to
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`encourage another’s infringement of the patent.”). To prevail on a contributory
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`infringement claim, “in addition to proving an act of direct infringement, [a] plaintiff must
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`show that [the] defendant knew that the combination for which its components were
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`especially made was both patented and infringing and that [the] defendant’s components
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`have no substantial non-infringing uses.” Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d
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`1301, 1320 (Fed. Cir. 2009). Similarly, “[k]nowledge of the patent alleged to be willfully
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`infringed [is] a prerequisite to enhanced damages.” WBIP, LLC v. Kohler Co., 829 F.3d
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`1317, 1341 (Fed. Cir. 2016).
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`What is necessary to plausibly allege pre-notification or pre-suit knowledge of the
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`at-issue patents? As with most types of cases, the Federal Rules of Civil Procedure don’t
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`require particulars. They establish no rules unique to patent cases, and Rule 9(b) says that
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`knowledge “may be alleged generally.” A leading treatise explains:
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`The concept behind this portion of Rule 9(b) is an
`understanding that any attempt to require specificity in
`pleading a condition of the human mind would be unworkable
`and undesirable. It would be unworkable because of the
`difficulty inherent in ascertaining and describing another
`person’s state of mind with any degree of exactitude prior to
`discovery. A rigid rule requiring the detailed pleading of a
`condition of mind would be undesirable because it would run
`counter to the general “short and plain statement of the claim”
`mandate in Federal Rule of Civil Procedure 8(a) without the
`considerations that warrant a specificity requirement for
`allegations of fraud or mistake.
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`5A Charles Alan Wright, Arthur R. Miller & A. Benjamin Spencer, Federal Practice and
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`Procedure: Civil § 1301 at 112–13 (2018). As the Supreme Court explained in Iqbal,
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`however, a conclusory allegation of knowledge is not enough. Iqbal, 556 U.S. at 686–87.
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`A pleader must comply with Rule 8 and allege facts from which knowledge plausibly may
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`be inferred. Id. For its part, the Federal Circuit has made clear in the patent context that
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`“direct evidence of knowledge is not required to support a finding of inducement,” Synqor,
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`Inc. v. Artesyn Techs., Inc., 709 F.3d 1365, 1380 (Fed. Cir. 2013) (citing Broadcom Corp.
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`v. Qualcomm, Inc., 543 F.3d 683, 700 (Fed. Cir. 2008)), and that a plaintiff need only allege
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`“enough facts to raise a reasonable expectation that discovery will reveal that the defendant
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`is liable for the conduct alleged,” Lifetime Indus., Inc. v. Trim-Lok, Inc., 869 F.3d 1372,
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`1380 (Fed. Cir. 2017) (cleaned up).
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`Case examples provide helpful guidance. In Nalco Co. v. Chem-Mod, LLC, the
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`plaintiff, Nalco, appealed the district court’s Rule 12(b)(6) dismissal of its fourth amended
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`complaint. 883 F.3d 1337, 1342 (Fed. Cir. 2018). Relevant here, the district court
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`dismissed claims of induced and contributory infringement, prompting the Federal Circuit
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`to determine whether Nalco plausibly pleaded the defendants’ knowledge of the patent in
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`suit. Id. at 1355–1357. Citing to a single page of Nalco’s complaint, the Federal Circuit
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`held that “Nalco explicitly pled facts to show Defendants’ knowledge, prior to filing suit,
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`of the [at-issue patent.]” Id. at 1357. On that page of the complaint, Nalco alleged: (1) a
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`defendant’s co-founder cited the at-issue patent in a patent application he filed; (2) prior to
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`filing suit, Nalco “provided the Defendants with express notice of its rights under the [at-
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`issue patent]”; and (3) “[u]pon information and belief,” the Defendants knew of Nalco’s
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`previous enforcement of the at-issue patent against others. Fourth Am. Compl. at
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`40, ¶ 109(a)–(c), Nalco Co. v. Chem-Mod, LLC, No. 1:14-cv-02510, 2015 WL 12517469
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`(N.D. Ill. Nov. 16, 2015), ECF No. 108.2
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`Nalco also alleged that it provided the defendants with a copy of its initial complaint
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`prior to filing suit. However, this allegation runs from the bottom of page 40 to the top of
`page 41 of Nalco’s Fourth Amended Complaint, and by citing only to page 40 of the
`pleading, the Federal Circuit appears not to have relied on this allegation to conclude that
`Nalco plausibly alleged the defendants’ pre-suit knowledge. See Fourth Am. Compl. at
`40–41, Nalco Co., 2015 WL 12517469; Nalco Co., 883 F.3d at 1357.
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`In Mastermine Software, Inc. v. Microsoft Corp., a case from this District, the court
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`determined that several facts supported the plausible inference that the defendant had pre-
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`suit knowledge of the at-issue patents:
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`(1) Plaintiff first released the software at issue in 1999; (2) Plaintiff filed an
`application for the software’s parent patent in 2000; (3) sometime prior to
`2005, Defendant reached out to Plaintiff to create a version of the software
`at issue for Defendant’s program; (4) a 2005 version of Defendant’s program
`included the technology described in the pending patent application; (5)
`Defendant cited both the application for and the ultimately issued parent
`patent itself in its own patent applications; (6) the parent patent was cited to
`Defendant by a patent examiner in connection with one of Defendant’s patent
`applications; and (7) the patents-in-suit are continuations of the parent patent.
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`No. 13-cv-971 (PJS/TNL), 2014 WL 12600276, at *2 (D. Minn. Mar. 12, 2014).
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`Other federal district courts have found a variety of circumstantial allegations and
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`evidence sufficient to show pre-notice or pre-suit knowledge of a patent. See, e.g., Simo
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`Holdings Inc. v. Hong Kong uCloudlink Network Tech. Ltd., 396 F. Supp 3d 323, 335
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`(S.D.N.Y. 2019) (finding evidence that one of the defendant’s employees was “at least
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`familiar with” the parent patent to the at-issue patent, among other circumstantial evidence,
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`sufficient to show pre-suit knowledge); Biomérieux, S.A. v. Hologic, Inc., No. 18-cv-21
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`(LPS), 2018 WL 4603267, at *4–5 (D. Del. Sept. 25, 2018) (finding allegations that the
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`defendants “waged an unsuccessful, years long campaign before the European Patent
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`Office urging authorities to revoke the European counterparts to the two U.S. patents-in-
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`suit,” and that “the parties compete within a small industry and [] the invention has
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`achieved some notoriety,” sufficient to plausibly allege knowledge of the patents during
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`the relevant time); Elm 3DS Innovations, LLC v. Samsung Elecs. Co., Ltd., No. 14-cv-1430,
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`2015 WL 5725768, at *2–3 (D. Del. Sept. 29, 2015) (finding the complaint sufficient to
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`plausibly allege pre-suit knowledge based on its allegations that (1) the plaintiff’s President
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`made a presentation to the defendants on the technology at issue and sent the defendant a
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`copy of the parent patent to the patent-in-suit; (2) “the presentation included several slides
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`depicting figures from the [parent] patent”; (3) the defendants cited to the parent patent and
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`related patents, though not the patent-in-suit, in prosecuting a number of their own patents;
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`and (4) the patent-in-suit “was well known in the [relevant] industry”).
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`In light of these authorities, Oxygenator plausibly alleges that Tennant knew of the
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`patents-in-suit prior to Oxygenator’s September 2019 letter (or, in the case of the ’665
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`patent, prior to the filing of this lawsuit).3 In “a patent application disclosing a floor
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`scrubber that generated microbubbles and nanobubbles with an electrolysis module” filed
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`in 2007, Tennant referenced a parent patent to the patents-in-suit. Am. Compl. ¶¶ 23–24.
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`In 2010, Oxygenator and Tennant communicated regarding Oxygenator’s offer to license
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`its technology to Tennant. Id. ¶¶ 26–30. These communications involved “Tennant’s
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`General Counsel and Director of Global Technology & Advanced Products” and included
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`documents referencing Oxygenator’s patent family and “the patent that re-issued into the
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`patents-in-suit[.]” Id. ¶¶ 26–27. Finally, Oxygenator alleges that “a reasonable company
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`in Tennant’s position” that possessed the information exchanged during the Parties’ 2010
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`This conclusion makes it unnecessary to consider Oxygenator’s alternative
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`argument that Tennant was willfully blind to the patents-in-suit. See Mem. in Opp’n at
`18–20.
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`communications “would continue to monitor [Oxygenator’s] portfolio” to avoid a risk of
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`infringement. Id. ¶ 31; see also Mem. in Opp’n at 14.4
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`C
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`Tennant last argues that Oxygenator has not alleged a plausible factual basis for
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`injunctive relief. Mem. in Supp. at 15–16. The Patent Act provides that a court “may grant
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`injunctions in accordance with the principles of equity to prevent the violation of any rights
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`secured by patent, on such terms as the court deems reasonable.” 35 U.S.C. § 283. A
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`plaintiff seeking a permanent injunction under the Patent Act must show:
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`(1) that it has suffered an irreparable injury; (2) that remedies available at
`law, such as monetary damages, are inadequate to compensate for that injury;
`(3) that, considering the balance of hardships between the plaintiff and
`defendant, a remedy in equity is warranted; and (4) that the public interest
`would not be disserved by a permanent injunction.
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`eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006).
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`Tennant argues that Oxygenator “has failed to allege it makes, sells, imports,
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`licenses, or otherwise is commercializing the Patents in Suit in any way” and, therefore,
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`that the amended complaint is “silent” as to each of the eBay factors. Mem. in Supp. at 15.
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`Tennant also argues that damages, rather than injunctive relief, are an adequate remedy
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`In Niazi Licensing Corp. v. St. Jude Med. S.C., the court denied a Rule 12(b)(6)
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`motion to dismiss claims for induced, contributory, and willful infringement, finding that
`“Niazi’s complaint clearly alleges that ‘St. Jude was aware of the [at-issue patent] prior to
`the filing of this lawsuit.’” 311 F. Supp. 3d 1078, 1083 (D. Minn. 2018). When asked at
`oral argument, Tennant did not challenge Niazi’s holding, though the single allegation
`supporting the defendant’s pre-suit knowledge in that case—“St. Jude was aware of the
`’268 patent prior to the filing of this lawsuit[]”—was considerably less descriptive than
`Oxygenator’s allegations here. See Compl. ¶ 21, Niazi Licensing Corp. v. St. Jude Med.
`S.C., No. 0:17-cv-05096 (WMW/BRT) (D. Minn. Nov. 13, 2017), ECF No. 1.
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`CASE 0:20-cv-00358-ECT-HB Document 38 Filed 08/07/20 Page 14 of 16
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`when, as here, claims of infringement concern “the use of a small component in a much
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`larger piece of equipment.” Id. For its part, Oxygenator says that dismissal of its request
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`for injunctive relief at this stage of the case would be premature and, alternatively, that it
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`has plausibly pled its entitlement to a permanent injunction. Mem. in Opp’n at 20–23. In
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`support of the latter argument, Oxygenator contends that “allowing Tennant to continue
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`infringing, even if Tennant was required to pay an ongoing royalty, would irreparably harm
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`[Oxygenator] by robbing it of the ability to make the exclusive license agreement it
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`desires.” Id. at 22.
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`Oxygenator’s status as a non-practicing entity does not categorically bar it from
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`seeking injunctive relief. In eBay, the United States Supreme Court rejected the district
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`court’s holding that “a ‘plaintiff’s willingness to license its patents’ and ‘its lack of
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`commercial activity in practicing the patents’ would be sufficient to establish that the patent
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`holder would not suffer irreparable harm if an injunction did not issue.” eBay, 547 U.S. at
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`393. The Court noted that “traditional equitable principles do not permit such broad
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`classifications” and observed that patent holders who preferred to license rather than
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`commercialize their patents “may be able to satisfy the traditional four-factor test, and we
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`see no basis for categorically denying them the opportunity to do so.” Id.; see Software
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`Research, Inc. v. Dynatrace LLC, 316 F. Supp. 3d 1112, 1137–38, 1138 n.4 (N.D. Cal.
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`2018) (rejecting defendant’s argument on motion to dismiss that plaintiff could not satisfy
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`eBay factors based on unsupported assertion that plaintiff was a non-practicing entity); see
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`also, e.g., Commonwealth Sci. & Indus. Research Org. v. Buffalo Tech. Inc., 492 F. Supp.
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`2d 600, 604 (E.D. Tex. 2007) (granting permanent injunction to non-practicing entity, a
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`CASE 0:20-cv-00358-ECT-HB Document 38 Filed 08/07/20 Page 15 of 16
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`research institution that relied on revenue from licensing to fund research and
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`development).
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`As to Oxygenator’s argument that dismissal of its request for an injunction would
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`be premature, courts on balance seem reticent to dismiss requests for injunctive relief at
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`the pleading stage and have held that “[a] claim for permanent injunction should not be
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`stricken at the pleading stage when the underlying claim is not dismissed.” Jerez v. Holder,
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`No. 10-cv-4498 (JRT/LIB), 2011 WL 7637808, at *12 (D. Minn. Sept. 1, 2011) (quoting
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`SEC v. Life Wealth Mgmt., Inc., 2010 WL 4916609 (C.D. Cal. Nov. 24, 2010)), report and
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`recommendation adopted as modified, 2012 WL 1072581 (D. Minn. Mar. 30, 2012). This
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`holds true in the context of patent infringement cases. See, e.g., KIPB LLC v. Samsung
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`Elecs. Co., No. 2:19-cv-00056-JRG-RSP, 2020 WL 1500062, at *6 (E.D. Tex. Mar. 9,
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`2020) (“[W]hether the Court ‘will reach and grant that relief on the merits can now only
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`be a matter of speculation,’ and ‘[s]peculation forms no part of the disposition of the rule
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`12(b)(6) motion before the [C]ourt.” (quoting Tanglewood E. Homeowners v. Charles-
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`Thomas, Inc., 849 F.2d 1568, 1576 (5th Cir. 1988))), report and recommendation adopted,
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`2020 WL 1495725 (E.D. Tex. Mar. 27, 2020); Simplivity Corp. v. Springpath, Inc., No.
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`4:15-13345-TSH, 2016 WL5388951, at *19 (D. Mass. July 15, 2016). That is not to say
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`that a court lacks discretion to do so when a complaint does not contain factual allegations
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`that “raise[] any indication that . . . a permanent injunction might eventually be
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`appropriate.” M & C Innovations, LLC v. Igloo Prods. Corp., No. 4:17-CV-2372, 2018
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`WL 4620713, at *6 (S.D. Tex. July 31, 2018) (dismissing with prejudice patent holder’s
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`request for a permanent injunction after plaintiff conceded that its third complaint alleged
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`CASE 0:20-cv-00358-ECT-HB Document 38 Filed 08/07/20 Page 16 of 16
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`no facts to support injunctive relief and court determined amendment would be futile).
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`Here, Oxygenator’s amended complaint is not so lacking as the complaint described by the
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`court in M&C Innovations to warrant a Rule 12(b)(6) dismissal of its request for injunctive
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`relief. Oxygenator alleges plausible claims for which injunctive relief may be available.
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`Consistent with the weight of authority, this is enough for its request for a permanent
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`injunction to survive.
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`ORDER
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`Based on the foregoing, and all of the files, records, and proceedings herein, IT IS
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`ORDERED THAT:
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`1.
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`Defendant Tennant Company’s Motion to Dismiss [ECF No. 12] is
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`s/ Eric C. Tostrud
`Eric C. Tostrud
`United States District Court
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`DENIED.
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`Dated: August 7, 2020
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`16
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