Case 6:14-cv-00982-KNM Document 169 Filed 12/07/15 Page 1 of 6 PageID #: 2085
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TYLER DIVISION
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`
`
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`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
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`Plaintiff,
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`v.
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`LG ELECTRONICS, INC., ET AL.,
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`Defendants.
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`
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`CIVIL ACTION NO. 6:14-cv-982-KNM
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`JURY TRIAL DEMANDED
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`CIVIL ACTION NO. 6:13-cv-508-KNM
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`JURY TRIAL DEMANDED
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`CIVIL ACTION NO. 6:14-cv-983-KNM
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`JURY TRIAL DEMANDED
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`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
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`
`Plaintiff,
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`
`v.
`
`
`LG ELECTRONICS, INC., ET AL.,
`
`
`Defendants.
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`
`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
`
`
`Plaintiff,
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`v.
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`SONY MOBILE COMMUNICATIONS
`INC., ET AL.,
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`Defendants.
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TYLER DIVISION
`
`
`
`
`
`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
`
`
`Plaintiff,
`
`
`v.
`
`
`LG ELECTRONICS, INC., ET AL.,
`
`
`Defendants.
`
`
`
`CIVIL ACTION NO. 6:14-cv-982-KNM
`
`
`JURY TRIAL DEMANDED
`
`
`
`
`
`CIVIL ACTION NO. 6:13-cv-508-KNM
`
`
`JURY TRIAL DEMANDED
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`
`
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`CIVIL ACTION NO. 6:14-cv-983-KNM
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`
`JURY TRIAL DEMANDED
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`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
`
`
`Plaintiff,
`
`
`v.
`
`
`LG ELECTRONICS, INC., ET AL.,
`
`
`Defendants.
`
`
`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
`
`
`Plaintiff,
`
`
`v.
`
`
`SONY MOBILE COMMUNICATIONS
`INC., ET AL.,
`
`
`Defendants.
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`
`
`
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`
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`Case 6:14-cv-00982-KNM Document 169 Filed 12/07/15 Page 2 of 6 PageID #: 2086
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`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC,
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`
`Plaintiff,
`
`
`v.
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`SAMSUNG ELECTRONICS CO., LTD., ET
`AL.,
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`Defendants.
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`CIVIL ACTION NO. 6:14-cv-759-KNM
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`JURY TRIAL DEMANDED
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`PLAINTIFF’S MOTION TO DISMISS BREACH OF CONTRACT COUNTERCLAIMS
`ASSERTED BY CERTAIN MANUFACTURER DEFENDANTS
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`Defendants LG Electronics, Inc., LG Electronics U.S.A., Inc. (collectively “LG”), Sony
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`Mobile Communications (USA) Inc. (“Sony”), and Samsung Electronics Co., Ltd. and Samsung
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`Electronics America, Inc. (collectively “Samsung”, and with LG and Sony, “Defendants”) each
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`assert specious breach of contract counterclaims in their respective answers1 to the operative
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`complaint by Cellular Communications Equipment LLC (“CCE”). The breach of contract
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`counterclaims2 neither sufficiently plead the existence of a contract to which CCE is a party, nor
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`plead Defendants’ performance (or tendered performance) as required by the Fifth Circuit. Thus,
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`Defendants fail to state a claim upon which relief may be granted.
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`1 Samsung answers in C.A. No. 6:14-cv-759 as Dkt. No. 141 (“Samsung Counterclaims”). LG
`answers in C.A. No. 6:13-cv-508 as Dkt. No. 87 (“LG Wave I Counterclaims”) and C.A. No.
`6:14-cv-982 as Dkt. No. 151 (“LG Wave II Counterclaims”). Sony answers in C.A. No. 6:14-cv-
`982 as Dkt. No. 149 (“Sony Counterclaims”). This motion to dismiss is made in each of those
`actions, as Defendants claims are substantively identical.
`2 Found in the Samsung Counterclaims at ¶¶19-28, the LG Wave I Counterclaims at ¶¶251-260,
`the LG Wave II Counterclaims at ¶¶200-209, and the Sony Counterclaims at ¶¶36-46.
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`Case 6:14-cv-00982-KNM Document 169 Filed 12/07/15 Page 3 of 6 PageID #: 2087
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`APPLICABLE LAW
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`Dismissal is appropriate under Fed. R. Civ. P. 12(b)(6) when a plaintiff (or
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`counterclaimant) fails to satisfy the pleading requirements of Fed. R. Civ. P. 8(a)(2). Although
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`detailed factual allegations are not required, a plaintiff must elucidate the grounds of his
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`entitlement to relief beyond mere “labels and conclusions.” Bell Atlantic Corp. v. Twombly, 550
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`U.S. 544, 555 (2007). In other words, “a formulaic recitation of the elements of a cause of action
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`will not do.” Id.
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`Moreover, the pleading must be factually suggestive, so as to “raise a right to relief above
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`the speculative level” and into the “realm of plausible liability.” Id. at 555, 557, n.5. “A claim
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`has facial plausibility when the plaintiff pleads factual content that allows the court to draw the
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`reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal,
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`556 U.S. 662, 678 (2009). This includes the basic requirement that the facts plausibly establish
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`each required element for each legal claim. Id. at 682-83.
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`In Texas, the “essential elements of a breach of contract action are: (1) the existence of a
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`valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of the
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`contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach.”
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`Smith Int’l, Inc. v. Egle Group LLC, 490 F.3d 380, 387 (5th Cir. 2007).
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`FACTS AND ARGUMENT
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`Despite having participated in this lawsuit from as early as 2013, Defendants only
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`recently answered CCE’s complaints. The answers followed multiple failed motions to dismiss
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`in which Defendants asserted, among other things, that CCE failed (in certain ways) to
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`appropriately plead claims of patent infringement.
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`Although Defendants have had years to refine their breach of contract claim before
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`actually having to plead it, their best attempt is this:
`2
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`Case 6:14-cv-00982-KNM Document 169 Filed 12/07/15 Page 4 of 6 PageID #: 2088
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`CCE and/or its predecessors [sic] ETSI membership and
`activities, including the declarations it made to comply with
`ETSI’s IPR policy for the Alleged Standard Essential Patents,
`created an express and/or implied contract with ETSI and/or
`ETSI members including an agreement that CCE and/or its
`predecessors would license those patents on FRAND terms and
`conditions.
`
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`Sony Counterclaims at ¶39; see also LG Wave I Counterclaims at ¶254, LG Wave II
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`Counterclaims at ¶203, and Samsung Counterclaims at ¶22 (emphasis added).
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`Defendants’ loose allegations regarding the existence of a contract to which CCE is a
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`party fails to state a claim. In the Fifth Circuit, alleging the existence of a valid contract is “a
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`crucial element to a breach of contract claim.” Castillo v. Ocwen Loan Servicing, L.L.C., 539
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`Fed. Appx. 621, 624 (5th Cir. Tex. 2013).
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`First, Defendants fail to identify an “express and/or implied contract” between CCE and
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`Defendants (there is no such contract). Second, to the extent Defendants rely on “an express
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`and/or implied contract” involving CCE’s “predecessors,” Defendants’ neither identify CCE’s
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`alleged “predecessors,” nor allege any factual basis as to why CCE is a proper party to sue for a
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`breach of the unidentified contract (there is no tenable theory). Instead, Defendants’ allegations
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`are a labyrinth of conjunctions that amount to no more than an accusation that somehow,
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`somewhere, an agreement was made that somehow binds CCE to license patents to Defendants
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`on FRAND terms. Such confusing and broad allegations do not permit CCE to properly defend
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`itself.
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`Further, Defendants must also plead their performance or tendered performance.
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`Defendants’ claims are devoid of any such allegation. Presumably, to plead this element,
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`Defendants must allege the tender of their respective willingness to license CCE patents on
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`FRAND terms. This has not occurred and cannot be pled.
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`3
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`Case 6:14-cv-00982-KNM Document 169 Filed 12/07/15 Page 5 of 6 PageID #: 2089
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`Because Defendants have failed to properly and sufficiently plead breach of contract,
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`their breach of contract counterclaims should, in each instance, be dismissed.
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`Dated: December 7, 2015
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`Respectfully submitted,
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`
`/s/ Edward R. Nelson III
`Edward R. Nelson III
`ed@nelbum.com
`Texas State Bar No. 00797142
`Thomas C. Cecil
`tom@nelbum.com
`Texas State Bar No. 24069489
`NELSON BUMGARDNER PC
`3131 West 7th Street, Suite 300
`Fort Worth, Texas 76107
`Phone: (817) 377-9111
`Fax: (817) 377-3485
`
`T. John Ward, Jr.
`Texas State Bar No. 00794818
`J. Wesley Hill
`Texas State Bar No. 24032294
`Claire Abernathy Henry
`Texas State Bar No. 24053063
`WARD & SMITH LAW FIRM
`P.O. Box 1231
`1127 Judson Rd. Ste. 220
`Longview, Texas 75606-1231
`(903) 757-6400
`(903) 757-2323 (fax)
`jw@jwfirm.com
`wh@wsfirm.com
`claire@wsfirm.com
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`ATTORNEYS FOR PLAINTIFF
`CELLULAR COMMUNICATIONS
`EQUIPMENT LLC
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`Case 6:14-cv-00982-KNM Document 169 Filed 12/07/15 Page 6 of 6 PageID #: 2090
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that a copy of the foregoing was served on all parties of record
`on December 7, 2015 via the Court’s CM/ECF system.
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`/s/ Edward R. Nelson III
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`5
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