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RA Medical Systems Inc. v. Photomedex

October 29, 2007


The opinion of the court was delivered by: Honorable Janis L. Sammartino United States District Judge


Presently before the Court is Counterclaim Defendants ("Defendants") RA Medical and Dean Irwin's motion to dismiss Counterclaim Plaintiff ("Plaintiff") Photomedex's first, second, third, and fifth claims for relief [Doc. No. 10], Plaintiff's opposition [Doc. No. 18], and Defendants' reply [Doc. No. 20.] For the following reasons, this Court GRANTS Defendants' motion without prejudice.


Plaintiff first filed suit against RA Medical on April 29, 2003 in the Superior Court of the State of California for, inter alia, alleged violations of trade secrets, unfair competition and conversion. [Def.'s Motion, Exhibit 1.] Plaintiff dismissed the trade secrets and unfair competition claim two days before trial. [Def.'s Motion, Exhibit 2.]

A week after dismissing the state court case, Plaintiff filed suit in federal court. [Def.'s Motion, Exhibit 12.] It alleged false advertising in violation of the Lanham Act and Business and Professions Code ("B&P Code") Sections 17200 and 17500 based, in part, on the allegations that RA Medical's "Pharos" laser was not approved by the Food & Drug Administration ("FDA"). Defendants filed a motion for summary judgment in that action and the motion is currently before this Court (hereinafter "First Action").

Earlier in the First Action, Plaintiff filed a motion for partial summary judgment for Defendants' alleged violations of California's Health and Safety Code. [See Def.'s Motion, Exhibits 18-21.] Judge Lorenz denied Plaintiff's motion and found that the allegation did not comply with the Rule 8 pleading standard. [SeeFirst Action, Doc. No. 112.] Thereafter, Defendants filed suit against Plaintiff in state court for violating the same Health and Safety Code sections. Plaintiff removed Defendants' complaint to this Court based on diversity jurisdiction.

Plaintiff then filed a counterclaim to Defendants' complaint. In the counterclaim, Plaintiff alleges Defendants engaged in misappropriation of trade secrets, false advertising in violation of the Lanham Act and B&P Code Section 17500, unfair competition in violation of B&P Code Section 17200, and tortious interference with contract. Defendant now moves to dismiss each claim other than the tortious interference with contract claim.


Federal Rule of Civil Procedure 12(b)(6) provides the vehicle by which a defendant may attack a complaint (or counterclaim) that fails to allege facts sufficient to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). In a Rule 12(b)(6) motion to dismiss, a plaintiff's allegations of material fact are accepted as true and are construed in the light most favorable to plaintiff. Barron v. Reich, 13 F.3d 1370, 1374 (9th Cir. 1994). However, the court need not accept as true allegations that contradict facts which may be judicially noticed by the court. Mullis v. United States Bank. Ct., 828 F.2d 1385 (9th Cir. 1987).

"Dismissal [for failure to state a claim] can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). Although the allegations of a complaint must be taken as true for purposes of a decision on the pleadings, dismissal is proper if the complaint is vague, conclusory, and fails to set forth any material facts in support of the allegation. North Star Int'l v. Arizona Corp. Comm'n, 720 F.2d 578, 583 (9th Cir. 1983).


A. Plaintiff's Claim for Misappropriation of Trade Secrets Is Barred by the Statute of Limitations

"Affirmative defenses, like the statute of limitations may be raised in motions to dismiss filed before the first responsive pleading." Cedards-Sinai Medical Center v. Shalala, 177 F.3d 1126, 1128-29 (9th Cir. 1287); Vernon v. Heckler, 811 F.2d 1274, 1278 (9th Cir. 1987). In analyzing the motion to dismiss, a court may consider the submission of public records, including pleadings, orders, and other papers on file in another action. Reyn's Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006); MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir. 1986). California Civil Code Section 3426.6 states: "[a]n action for misappropriation must be brought within three years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered . . . [and] for the purposes of this section, a continuing misappropriation constitutes a single claim." Cal. Civ. Code § 3426.6 (2007). "A plaintiff is under a duty to reasonably investigate, and a suspicion of wrongdoing, coupled with a knowledge of the harm and its cause, commences the limitations period." Snapp & Associates Insurance Services, Inc. V. Malcolm Bruce Burlingame Robertson, 96 Cal.App.4th 884, 891 (2002).

Over three years ago, on April 29, 2003, Plaintiff filed a state court complaint against RA Defendants. [Def.'s Motion, Exhibit 1.] It also moved for a temporary restraining order. [Def.'s Motion, Exhibit 3 & 4.] In the 2003 state complaint, Plaintiff alleged similar facts to those it alleges in this counterclaim. [See Def.'s Motion, Exhibit, 1 ¶¶ 11-16.] Plaintiff's Chief Technical Officer, Jeffrey Levatter, stated that in March of 2003 he attended the Annual Meeting of the American Academy of Dermatology. [Def.'s Motion, Levatter Decl., ¶¶ 7 & 8.] He further stated that Mr. Irwin was making available to the attendees a brochure promoting the excimer laser and peripherals. [Id. ¶ 9.] Mr. Levatter claimed he received and reviewed the Pharos' brochure and concluded that "the technical specifications for the excimer laser described in that brochure are substantially identical in all material aspects to XTRAC" and that the "continuously adjustable spot hand piece described in ...

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