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`Case 6:20-cv-00636—ADA Document 51-6 Filed 02/23/21 Page 1 of 26
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`EXHIBIT 5
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`EXHIBIT 5
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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 2 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 1 of 25
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`IRELL & MANELLA LLP
`Morgan Chu (70446)
`MChu@irell.com
`Benjamin W. Hattenbach (186455)
`BHattenbach@irell.com
`C. Maclain Wells (221609)
`MWells@irell.com
`1800 Avenue of the Stars, Suite 900
`Los Angeles, California 90067-4276
`Telephone: (310) 277-1010
`Facsimile:
`(310) 203-7199
`
`Attorneys for Defendant
`DEMARAY LLC
`
`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`SAN JOSE DIVISION
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`APPLIED MATERIALS, INC.,
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`Plaintiff,
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`vs.
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`DEMARAY LLC,
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`Defendant.
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`Case No. 5:20-cv-09341-EJD
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`DEMARAY LLC’S NOTICE OF MOTION
`AND MOTION TO DISMISS
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`Hearing Date: April 8, 2021
`Hearing Time: 9:00 a.m.
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`10907052
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 2 of 25
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`TO THE COURT AND ALL PARTIES AND THEIR COUNSEL OF RECORD:
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`PLEASE TAKE NOTICE THAT on April 8, 2021, at 9:00 a.m., or as soon thereafter as
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`may be heard, Defendant Demaray LLC (“Demaray”) shall and hereby does move for an order
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`dismissing Applied Materials, Inc.’s (“Applied”) Complaint (“Complaint”) with prejudice. This
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`Motion is based upon this Notice of Motion, the accompanying Memorandum of Points and
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`Authorities included herewith, the accompanying Declaration of C. Maclain Wells and evidence
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`attached thereto, the files, records, and pleadings in this case, such evidence and argument as may
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`be proffered at the hearing of this Motion, and any other matters that the Court deems appropriate.
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`Dismissal is warranted under Federal Rules of Civil Procedure 12(b)(1) for lack of subject-
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`matter jurisdiction and 12(b)(6) and failure to state a claim upon which relief can be granted.
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`Dismissal is also appropriate pursuant to this Court’s discretion to decline declaratory judgment
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`Respectfully submitted,
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`Irell & Manella LLP
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`By: /s/ C. Maclain Wells
`C. Maclain Wells
`Attorneys for Plaintiff
`DEMARAY LLC
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`jurisdiction.
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`Dated: January 26, 2021
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`10907052
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 4 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 3 of 25
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`TABLE OF CONTENTS
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`Page
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`I.
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`II.
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`PRELIMINARY STATEMENT ......................................................................................... 1
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`BACKGROUND ................................................................................................................. 2
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`A.
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`B.
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`C.
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`The Parties ............................................................................................................... 2
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`Texas Litigation ....................................................................................................... 2
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`Applied’s Duplicative Complaints In California .................................................... 3
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`III.
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`ARGUMENT ...................................................................................................................... 6
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`A.
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`The Court Should Affirm Its Determination That The Texas
`Complaints Do Not Give Rise To A Case And Controversy Between
`Applied and Demaray .............................................................................................. 7
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`1.
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`The Court Properly Determined That Demaray’s Texas
`Complaints Do Not Support Declaratory Judgment Subject
`Matter Jurisdiction ....................................................................................... 7
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`a)
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`b)
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`c)
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`There Was No Implicit Allegation Of Direct
`Infringement .................................................................................... 8
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`There Is No Implicit Allegation Of Indirect
`Infringement .................................................................................. 10
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`Applied Presents No New Facts Warranting A
`Different Outcome ......................................................................... 11
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`B.
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`C.
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`The Court Should Exercise Its Discretion To Decline Jurisdiction ...................... 16
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`The Court Should Dismiss Applied’s Defenses Based On Unlawful
`Licensing Provisions ............................................................................................. 17
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`IV.
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`CONCLUSION ............................................................................................................... 201
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`1 All exhibits are attached to the concurrently filed Declaration of C. Maclain Wells.
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`10907052
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`- i -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 4 of 25
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`TABLE OF AUTHORITIES
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`Page(s)
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`Cases2
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`Adobe Sys., Inc. v. Kelora Sys.,
`2011 WL 6101545 (N.D. Cal. Dec. 7, 2011) ...............................................................................6
`
`Albers v. Yarbrough World Sols.,
`LLC, 2020 WL 6064334 (N.D. Cal. Oct. 14, 2020) ..................................................................19
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`Amazon.com, Inc. v. Straight Path IP Grp., Inc.,
`2015 WL 3486494 (N.D. Cal. May 28, 2015) ...........................................................................17
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`Applied Materials, Inc. v. Advanced Micro-Fabrication Equip. (Shanghai) Co.,
`630 F. Supp. 2d 1084 (N.D. Cal. May 20, 2009) ............................................................... passim
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`Arris Grp., Inc. v. British Telecomms. PLC,
`639 F.3d 1368 (Fed. Cir. 2011) ..................................................................................................10
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`Ass’n for Molecular Pathology v. U.S. Patent & Trademark Office,
`689 F.3d 1303 (Fed. Cir. 2012) ..............................................................................................6, 12
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`Bal Seal Eng’g, Inc. v. Nelson Prods., Inc.,
`2016 WL 11518601 (C.D. Cal. Sept. 8, 2016) ...........................................................................13
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`Cepheid v. Roche Molecular Sys., Inc.,
`2013 WL 184125 (N.D. Cal. Jan. 17, 2013) ..............................................................................16
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`Crossbow Tech., Inc. v. YH Tech.,
`531 F. Supp. 2d 1117 (N.D. Cal. 2007) .......................................................................................6
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`Hewlett-Packard Co. v. Acceleron LLC,
`587 F.3d 1358 (Fed. Cir. 2009) ....................................................................................................7
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`MedImmune, Inc. v. Genentech, Inc.,
`549 U.S. 118 (2007) .................................................................................................................6, 7
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`Microsoft Corp. v. GeoTag, Inc.,
`817 F.3d 1305 (Fed. Cir. 2016) ..................................................................................................14
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`Microsoft v. DataTern,
`755 F.3d 899 (Fed. Cir. 2014) ......................................................................................6, 9, 10, 11
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`2 Unless otherwise noted, internal citations, quotations and subsequent history are omitted,
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`and emphasis is added unless otherwise indicated.
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`10907052
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`- ii -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 5 of 25
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`Page(s)
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`Power Integrations, Inc. v. De Lara,
`2020 WL 1467406 (S.D. Cal. Mar. 26, 2020) ............................................................................20
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`Proofpoint, Inc. v. InNova Patent Licensing,
`2011 WL 4915847 (N.D. Cal. Oct. 17, 2011) ..................................................................7, 11, 16
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`SanDisk Corp. v. STMicroelectronics, Inc.,
`480 F.3d 1372 (Fed. Cir. 2007) ....................................................................................................7
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`In re Vistaprint Ltd.,
`628 F.3d 1342 (Fed. Cir. 2010) ..................................................................................................17
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`Wenke v. Forest Labs., Inc.,
`2018 WL 1911957 (N.D. Cal. Apr. 23, 2018) ...........................................................................19
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`Whitewater W. Indus., Ltd. v. Alleshouse,
`981 F.3d 1045 (Fed. Cir. 2020) ........................................................................................2, 18, 20
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`Statutes
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`California Business & Professions Code § 16600 .....................................................................18, 20
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`Rules
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`Federal Rule of Civil Procedure 12(b)(1) ..........................................................................................1
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`Federal Rule of Civil Procedure 12(b)(6) ..............................................................................2, 19, 20
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`10907052
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`- iii -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 7 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 6 of 25
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`MEMORANDUM OF POINTS AND AUTHORITIES
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`I.
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`PRELIMINARY STATEMENT
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`Applied’s newest version of its declaratory judgment complaint rehashes the same
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`arguments regarding subject matter jurisdiction already rejected by the Court, and should likewise
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`be dismissed under Federal Rule of Civil Procedure 12(b)(1). The Court already determined that
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`there was no subject matter jurisdiction for Applied’s First Amended Complaint (“FAC”) in related
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`case no. 5:20-cv-05676-EJD (“Applied I”) based upon the same causes of action. See Ex. 1 (Order).
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`There, the Court considered and rejected Applied’s contention that Demaray’s earlier-filed
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`complaints in Texas against Intel and Samsung (Applied is one of Intel’s and Samsung’s reactor
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`suppliers) raised implicit infringement allegations against Applied. Specifically, the Court
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`recognized that in the Texas complaints, Demaray accused methods of thin-film deposition in a
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`physical vapor deposition (“PVD”) reactor with a specific configuration used by Intel and
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`Samsung, and that specific reactor configuration, of infringement. Demaray did not accuse
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`Applied’s reactors standing alone of infringement and Demaray has made no express or implied
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`infringement assertions against Applied in the Texas complaints or anywhere else. On these facts,
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`the Court determined that the Texas complaints did not give rise to a justiciable controversy.
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`Nothing has changed that warrants reconsideration of the Court’s prior determination. The
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`few new factual allegations that Applied points to in its new Complaint, if anything, only reaffirm
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`that (1) Demaray is not relying on Applied publications for certain reactor configuration claim
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`limitations, (2) Applied itself represents that it does not supply any reactors in the infringing
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`configurations, and (3) Demaray still lacks sufficient information to determine whether or not
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`Applied is infringing. There is still no case and controversy between Demaray and Applied.
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`Even if subject matter jurisdiction over this action did exist (it does not), efficiency and
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`judicial economy warrant the Court’s exercise of its discretion to decline jurisdiction. Applied’s
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`conduct, both here and in Texas, establishes that it did not bring this case to address a threat of legal
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`action, but rather as yet another extreme attempt at forum shopping. The Texas cases are well
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`underway, with their Markman hearings in March and trials set for this December, and are best
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`suited to resolving any real issues.
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`10907052
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`- 1 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-009341-EJD)
`
`

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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 7 of 25
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`In addition, for independent reasons, the Court should dismiss Applied’s licensing and
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`ownership declaratory judgment claims under Federal Rule of Civil Procedure 12(b)(6). Those
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`claims depend on employee agreement assignment provisions that Judge Ware already ruled are
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`“unlawful non-compete provisions” and void as a matter of public policy. See Applied Materials,
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`Inc. v. Advanced Micro-Fabrication Equip. (Shanghai) Co., 630 F. Supp. 2d 1084, 1090 (N.D. Cal.
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`May 20, 2009); see also Whitewater W. Indus., Ltd. v. Alleshouse, 981 F.3d 1045, 1055–59 (Fed.
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`Cir. 2020) (reversing district court reliance on unlawful assignment provisions and citing Advanced
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`Micro-Fabrication with approval). Applied cannot base a “colorable claim on which relief could be
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`granted” upon contract provisions already adjudicated to be unlawful.
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`10
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`II.
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`BACKGROUND
`A.
`The Parties
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`Demaray is a limited liability company organized under the laws of the State of Delaware.
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`Dkt. 1 (“Complaint” ¶25). Demaray owns U.S. Patent Nos. 7,544,276 and 7,381,657 (the
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`“Demaray patents”). See Dkt. 1, Ex. A (“Intel Compl.”) ¶5; Dkt. 1, Ex. B (“Samsung Compl.”) ¶5
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`(collectively, the “Texas complaints”). Demaray was founded for research, development, and
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`commercialization of new product applications based on technologies developed by Dr. Richard E.
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`Demaray, including the patented technology for the production of low-defect thin films for
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`advanced electronic devices. Intel Compl. ¶3; Samsung Compl. ¶3.
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`Applied is a materials engineering company headquartered in Santa Clara, California.
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`Complaint ¶24. Applied manufactures products used in semiconductor fabrication, including PVD
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`reactors in the Endura product line. Id. Intel and Samsung use PVD reactors, from Applied and
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`other suppliers, configured in a specific manner to deposit certain thin films in their semiconductor
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`products. Intel Compl. ¶25; Samsung Compl. ¶28.
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`B.
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`Texas Litigation
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`In July 2020, Demaray filed the Texas complaints against Intel and Samsung, alleging that
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`Intel’s and Samsung’s use of specific reactor configurations infringed the Demaray patents. See,
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`e.g., Intel Compl. ¶¶22, 47; Samsung Compl. ¶¶25, 50. The Demaray patents have claim elements
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`requiring, for example, the use of a reactor configuration with “a narrow band-rejection filter that
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`10907052
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`- 2 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 8 of 25
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`rejects at a frequency of the RF bias power supply coupled between the pulsed DC power supply
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`and the target area.” See, e.g., Dkt. 1, Ex. P (“’276 Patent”), claim 1. It is undisputed that the
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`“[Texas] Complaints did not name Applied as a Defendant or expressly accuse Applied of
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`infringement.” See Complaint ¶27. They instead alleged that Intel and Samsung each “configures,
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`or causes to be configured, [their] RMS reactors such that they comprise a narrow band-rejection
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`filter.” See, e.g., Intel Compl. ¶¶39-40 (alleging that “Intel configures, or causes to be configured,
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`the Intel RMS reactors such that they comprise a narrow band-rejection filter”); Samsung Compl.
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`¶¶42-43 (alleging that “Samsung configures, or causes to be configured, the Samsung RMS
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`reactors such that they comprise a narrow band-rejection filter”). They then use those reactors
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`themselves to perform the processes that they choose to run in the course of manufacturing
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`semiconductor devices. Intel Compl. ¶¶33-35, 39-40; Samsung Compl. ¶¶36-38, 42-43.
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`The Texas complaints demonstrate Demaray’s approach of suing the actual users of the
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`infringing reactor configurations, not equipment suppliers like Applied. Nor would filing suit
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`against Applied make any sense under the current facts because, as Applied knows perfectly well,
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`Applied itself represents that it does not supply any reactors in the infringing configurations.
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`Complaint ¶¶94, 99. Applied affirmatively represents, for instance, that any reactors it supplies do
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`not include foundational claim elements such as the claimed “narrow band-rejection filter” of the
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`specific reactor configurations accused in the Texas suits. Complaint ¶¶95, 100. Demaray has not
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`amended the Texas complaints and they are still the operative pleadings in the Texas actions.
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`C.
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`Applied’s Duplicative Complaints In California
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`A month after the filing of the Texas complaints, Applied filed its third-filed complaint in
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`Applied I on August 13, 2020 and, later, its first amended complaint (“FAC”) on September 1,
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`2020. See Complaint, ¶40. Applied did so, not because of any threat of impending litigation from
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`Demaray, but to come to the aid of its customers, Intel and Samsung. See Applied I, Dkt. 13, FAC
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`¶1 (“Demaray’s lawsuits against Applied’s customers have placed a cloud over Applied’s products
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`….”). Applied then sought to derail the Texas cases asking this Court for a preliminary injunction
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`enjoining the Texas cases from proceeding. See Complaint ¶41.
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`In opposition to Applied’s injunction request, Demaray raised, inter alia, issues regarding
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`10907052
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`- 3 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 9 of 25
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`the lack of subject matter jurisdiction for Applied’s suit. See id. ¶42. In an effort to support its
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`arguments regarding a case in controversy, Applied submitted with its reply in support of its
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`injunction request, among other materials, a series of declarations from Intel, Samsung, and
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`Applied Materials (see, e.g., Dkt. 1, Ex. Q)3 and argued that the Texas complaints raised a self-
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`servingly alleged subjective “belief” on behalf of Applied that Demaray was “implicitly alleging”
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`infringement by Applied’s reactors by themselves. See, e.g., id. ¶5 (“Based on my review of the
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`Customer Complaints, I understood that Demaray was making an implied assertion of
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`infringement of the Asserted Patents against Applied.”); id. ¶9 (“[A]fter Applied reviewed the
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`allegations in the Customer Complaints against Intel and Samsung, Applied interpreted those
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`allegations as directed at … the reactors as manufactured, configured and installed by Applied.”).
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`On December 16, the Court denied Applied’s motion for preliminary injunction due to the
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`lack of subject matter jurisdiction. Ex. 1 (Order). The Court held that “Applied Has Failed to
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`Allege that Demaray Engaged in Affirmative Acts Directed at Applied.” Id. at 4.The Court first
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`noted that “[t]here is no indication Demaray has ever made any infringement allegations against
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`Applied.” Id. at 6. The Court went on to hold that in the Texas complaints, “Demaray alleges Intel
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`and Samsung configure the reactors such that they are comprised of a pulsed DC power supply
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`coupled to the target area, a RF bias power supply coupled to the substrate, and a narrow band
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`rejection filter placed between the DC power supply and the target area in order to deposit the thin
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`layer films in its semiconductor products. … Demaray does not allege in the WDTX Actions that
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`Applied itself configures the reactors or promotes the patented configuration and method. ...
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`Accordingly, Applied has failed to allege an actual controversy with respect to direct
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`infringement of Demaray’s patents.” Id. at 7-8.
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`Desperate to have a court other than WDTX adjudicate the Intel/Samsung infringement
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`issues, on December 24, 2020, Applied filed a fifth-filed Complaint (Applied II) on the
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`substantively duplicative causes of action as in Applied I. See Dkt. 1 (Complaint). Despite this
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`3 The Court considered both Applied’s reply evidence (Dkt. 47 at 1, n. 1) and the Western
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`District of Texas complaints and publicly available docket entries in those cases (id., at 3, n. 2) in
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`determining that subject matter jurisdiction was lacking for Applied’s injunction request.
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`10907052
`
`- 4 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 11 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 10 of 25
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`Court’s prior order addressing the Texas complaints, Applied again argued that “Demaray’s
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`affirmative act of filing the Customer Suits, which implicitly accused Applied and Applied’s
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`reactors of infringement, created a reasonable potential that infringement claims could be brought
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`against Applied based on the same allegations.” See Complaint ¶¶3-8. The only additional
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`affirmative acts by Demaray against Applied that Applied added to its new Complaint are: (1)
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`Demaray requesting transfer-related discovery from Applied in Texas, in response to transfer
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`motions filed by Intel and Samsung in Texas that argued about the location of Applied’s activities;
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`and, (2) Demaray’s explanation to this Court that it would need discovery from Applied to bring
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`infringement counterclaims in Applied I (shown below in green in original). Id. ¶9. If anything,
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`these actions reaffirm Demaray’s position that it does not currently have enough information to
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`accuse Applied of infringement—the opposite of a ripe case and controversy.
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`The other “additional” information on which Applied relies, Demaray’s preliminary
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`infringement contentions in the Texas cases (see Dkt. 1, Exs. C-D), fares no better. First, Applied
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`acknowledges that Demaray directed these contentions at Intel and Samsung, not Applied. Id. Like
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`Demaray’s Texas complaints, the contentions do not include any affirmative infringement
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`allegations against Applied. See, e.g., Ex. C at 26 (“As a further example, Intel configures and
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`uses, among other reactors, Intel Accused Products in the Endura product line from Applied
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`Materials, Inc. for deposition of such layers ….”), Ex. D at 27 (similar for Samsung). And, like
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`the Texas complaints, they are based upon (1) publicly available materials regarding Intel’s and
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`Samsung’s reactors and (2) confidential reverse engineering reports detailing Intel’s and
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`Samsung’s infringing use of the claimed reactor configurations. See Complaint ¶47. While certain
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`Applied publications are cited in the contentions, those documents are coextensive with the
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`materials cited in the Texas complaints. The Court has already determined that “[t]he Applied
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`publications Demaray references do not discuss the specific configuration or method covered
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`under Demaray’s Asserted Patents … Instead, the Applied publications cover general
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`information and features of Applied’s reactors, and their ability to be utilized in the reactive
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`sputtering process.” Ex. 1 at 8. Like the Texas complaints, in its contentions, Demaray does not
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`cite or rely upon Applied publications for certain claim limitations, e.g., the narrow band-rejection
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`10907052
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`- 5 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 12 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 11 of 25
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`filter. See, e.g., Dkt. 1, Ex. C at 22; Ex. D at 23.
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`III.
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`ARGUMENT
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`To satisfy Article III’s standing requirements, a plaintiff must demonstrate that “the facts
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`alleged, under all the circumstances, show that there is a substantial controversy, between parties
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`having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a
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`declaratory judgment.” MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007). The party
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`alleging jurisdiction bears the burden of showing an “actual controversy.” Crossbow Tech., Inc. v.
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`YH Tech., 531 F. Supp. 2d 1117, 1120 (N.D. Cal. 2007). The Federal Circuit has held that a
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`declaratory judgment plaintiff must allege “(1) an affirmative act by the patentee related to the
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`enforcement of his patent rights, and (2) meaningful preparation to conduct potentially infringing
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`activity.” Ass’n for Molecular Pathology v. U.S. Patent & Trademark Office, 689 F.3d 1303, 1318
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`(Fed. Cir. 2012). The “affirmative act” must be “directed at that plaintiff, not just broad and
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`widespread enforcement activity.” Adobe Sys., Inc. v. Kelora Sys., 2011 WL 6101545, at *3-4
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`(N.D. Cal. Dec. 7, 2011). For example, the mere filing of litigation by a patentee against a
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`customer based on activities that involve the declaratory-judgment plaintiff’s product does not
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`create a case or controversy. Microsoft Corp. v. DataTern, Inc., 755 F.3d 899, 904 (Fed. Cir.
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`2014) (“Appellees argue that DataTern’s suits against its customers automatically give rise to a
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`case or controversy regarding induced infringement, we do not agree”).
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`As a preliminary matter, Applied bases its new, fourth-filed complaint on a self-servingly
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`alleged subjective “belief” that Demaray was “implicitly alleging” infringement by Applied’s
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`reactors by themselves. See, e.g., Ex. Q, ¶5 (“Based on my review of the Customer Complaints, I
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`understood that Demaray was making an implied assertion of infringement of the Asserted Patents
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`against Applied.”); id. ¶9 (“[A]fter Applied reviewed the allegations in the Customer Complaints
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`against Intel and Samsung, Applied interpreted those allegations as directed at Samsung and
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`Intel’s use of the reactors as manufactured, configured and installed by Applied.”); see also, e.g.,
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`Complaint ¶27 (“Applied also objectively and reasonably believed the allegations were directed at
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`Applied.”), ¶53 (“Applied objectively and reasonably believes this to be true.”). First, Applied’s
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`new Complaint relies on that same declaration (see Ex. K) submitted with its reply in support of
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`10907052
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`- 6 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 13 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 12 of 25
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`its injunction request in Applied I. The Court has already considered and rejected these arguments.
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`Second, in MedImmune, the Supreme Court rejected strict reliance on the “reasonable
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`apprehension of suit” prong of the test for subject matter jurisdiction. See 549 U.S. at 132
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`n.11; see also SanDisk Corp. v. STMicroelectronics, Inc., 480 F.3d 1372, 1380 (Fed. Cir.
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`2007) (“The Supreme Court's opinion in MedImmune represents a rejection of our reasonable
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`apprehension of suit test.”). Now, it is “the objective actions of the patentee [that] are the subject
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`of [the jurisdictional] inquiry,” not the subjective beliefs of the declaratory judgment plaintiff. Ex.
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`1 at 5; Hewlett-Packard Co. v. Acceleron LLC, 587 F.3d 1358, 1362-63 (Fed. Cir. 2009)
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`(patentee’s actions must give reason to believe that it is asserting its rights under the patents).
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`Here, objective actions by Demaray against Applied for enforcement of Demaray’s intellectual-
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`property rights are non-existent.
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`A.
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`The Court Should Affirm Its Determination That The Texas Complaints Do
`Not Give Rise To A Case And Controversy Between Applied and Demaray
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`There is no objective basis for the Court to reconsider its determination in Applied I that
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`the Texas complaints did not give rise to subject matter jurisdiction. See Ex. 1 at 12 (“the Court
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`does not have subject matter jurisdiction over Applied’s action for declaratory relief.”).
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`1.
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`The Court Properly Determined That Demaray’s Texas Complaints Do Not
`Support Declaratory Judgment Subject Matter Jurisdiction
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`As the Court already determined, “the WDTX Actions between Demaray and Applied’s
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`customers, Intel and Samsung, do not give rise to an actual controversy as to whether Applied
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`might be liable for direct patent infringement.” Ex. 1 at 7. It is undisputed that the Demaray
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`patents cover a “specific configuration or method.” Id. at 8. And the Court determined that
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`“[a]lthough Applied is a supplier of the reactors capable of this configuration and deposition
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`method, Demaray does not allege in the WDTX Actions that Applied itself configures the
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`reactors or promotes the patented configuration and method.” Id. The Texas complaints have not
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`been amended and these determinations are as true today as they were previously.
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`This is not a case where an entity makes an infringing product, and its customers are then
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`sued for doing nothing more than purchasing and using it in the only way possible. See
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`Proofpoint, Inc. v. InNova Patent Licensing, 2011 WL 4915847, at *5 (N.D. Cal. Oct. 17, 2011)
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`10907052
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`- 7 -
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`DEMARAY’S NOTICE OF MOTION AND
`MOTION TO DISMISS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 6:20-cv-00636-ADA Document 51-6 Filed 02/23/21 Page 14 of 26
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`Case 5:20-cv-09341-EJD Document 30 Filed 01/26/21 Page 13 of 25
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`(dismissing for lack of declaratory-judgment jurisdiction where no party “alleged that the mere
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`making or selling of [supplier’s] products is unlawful”). There is no allegation in the Texas
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`complaints that the Demaray patents cover all PVD reactor configurations. Ex. M (Demaray
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`Declaration) ¶12 (“The Demaray patents are directed generally at methods of depositing high
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`quality thin films in products by using a particular PVD reactor configuration. They do not cover
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`all PVD reactor configurations.”). Rather, the patents cover the use of “a particular PVD reactor
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`configuration.” Id. Demaray’s Texas complaints did not accuse Applied of using, making, selling,
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`or offering to sell the specific reactor configurations that Intel and Samsung themselves decide
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`upon and use. See, e.g., Intel Compl. ¶25 (“Intel configures RMS reactors, including, but not
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`limited to reactors in the Endura product line ….”), Samsung Compl. ¶28 (similar for Samsung).
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`a)
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`There Was No Implicit Allegation Of Direct Infringement
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`The Court previously determined that there was no implicit allegation in the Texas cases
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`that the Applied reactors standing alone infringe—this determination should stand. As an example,
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`the Demaray patent claims require “a narrow band-rejection filter that rejects at a frequency of the
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`RF bias power supply coupled between the pulsed DC power supply and the target area,” which
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`can prevent damaging feedback that can occur at the DC power source. See, e.g., Ex. P (’276
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`Patent), cl. 1. In the Texas cases, Demaray did not allege that Applied uses this specific
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`configuration to deposit thin films or cite to Applied publications to support infringement
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`allegations for this claim limitation. See Intel Compl. ¶¶39-40, 57; Samsung Compl. ¶¶42-43, 59.
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`Instead, Demaray relied upon reverse engineering of Intel and Samsung products suggesting
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`Intel’s and Samsung’s use of the infringing reactor configurations.
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`In its new Complaint, Applied repeats its rejected argument that the Texas complaints
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`included an “implied” assertion of infringement. See, e.g., Complaint ¶¶7, 16, 27, 39.