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Spellbound Development Group, Inc v. Pacific Handy Cutter et al

November 14, 2011

SPELLBOUND DEVELOPMENT GROUP, INC., PLAINTIFF,
v.
PACIFIC HANDY CUTTER ET AL., DEFENDANTS.



The opinion of the court was delivered by: David O. Carter United States District Judge

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR SUMMARY JUDGMENT OF NON-INFRINGEMENT AND INVALIDITY OF U.S. PATENT NO. 7,356,928; U.S. PATENT NO. 7,726,029; AND U.S. PATENT NO. 6,718,640 [269]

Before the Court is Motion for Summary Judgment of Non-Infringement and Invalidity ("Motion") filed by Defendants Pacific Handy Cutter, Inc. ("PHC"), Front Line Sales, Inc., and Stanley Black & Decker, Inc. (collectively "Defendants"). (Dkt. 269). After considering the moving papers and oral argument, the Court GRANTS IN PART and DENIES IN PART the Motion.

I.Background

Plaintiff Spellbound Development Group, Inc. ("Plaintiff") alleges patent infringement by Defendants Pacific Handy Cutter, Inc. ("PHC"), Front Line Sales, Inc., and Stanley Black & Decker, Inc. (collectively "Defendants"). Plaintiff's patents concern cutting devices with certain safety features, including blade guards and locking mechanisms for blades that protect against unintended blade displacement. The gravamen of Plaintiff's infringement claims is that a single product sold by PHC-the Razor Safety Cutter 432 ("RSC-432")-infringes Plaintiff's patents.

a.Plaintiff's internal email about Defendants' RSC-432

Prior to the present litigation, Defendants assert that Plaintiff's President stated in an internal email that Defendants' RSC-432 did not infringe Plaintiff's pending patents. Sealed Mot. (Dkt. 275) 9. Specifically, Plaintiff's President stated in an email that "we are well aware of their design and have run it by our IP attorneys" and the device does "not infringed on [Plaintiff's] patents or pending patents." Sealed Mot. (Dkt. 275) 9. Defendants assert that "their design" referred to Defendants' RSC-432. Id.

b.Plaintiff's original complaint, amendments, and attempted amendments

Plaintiff's initial complaint, filed on August 17, 2009, alleged infringement of only one patent: U.S. Patent No. 7,365,928 ("'928 patent").

On October 20, 2009, Plaintiff filed a first amended complaint that added allegations of infringement of U.S. Patent No. 6,178,640 ("'640 Patent"), which Plaintiff had just purchased.

On June 4, 2010, Plaintiff filed a second amended complaint that added allegations that PHC infringed the U.S. Patent No. 7,726,029 ("'029 Patent"), which issued on June 1, 2010.

On June 28, 2010, Plaintiff moved to file a third amended complaint, which added new defendant Stanley Black & Decker, and, following the Court's granting of that motion, the Third Amended Complaint was deemed filed on September 1, 2010. (Dkt. 105). On September 15, 2010, PHC answered, and added new counterclaims related to one of its patents, specifically patent mismarking, patent infringement, and false representation under the Lanham Act.

A year later, on June 20, 2011, the Court denied Plaintiff's ex parte application to amend its complaint. (Dkt. 260).

On July 1, 2011, a little more than a week after the Court denied Plaintiff leave to amend, Plaintiff again moved to amend its complaint. This time Plaintiff sought to add the newly-issued U.S. Patent No. 7,966,732 ('732 Patent), which Plaintiff averred was substantially similar to the '029 Patent. (Dkt. 261). The PTO had issued the '732 Patent on June 28, 2011. Id. The proposed Fourth Amended Complaint did not contain any reference to Claim 2 of the '928 Patent as a basis for Plaintiff's infringement theory. See id.

On August 9, 2011, the Court denied Plaintiff's motion to amend.*fn1 (Dkt 274).

c.This Court's case management orders

Prior to February 7, 2011, the parties filed summary judgment motions. (Dkts. 237, 238). However, the Court's trial calendar required that trial be rescheduled, and thus the Court struck these motions. (Dkts. 237, 256).

On May 17, 2011, this Court finalized the deadlines for this case as follows (Dkt. 256):

* Discovery Cut Off: July 27, 2011

* Motion Cut off/Deadline for Filing Summary Judgment Motions: August 8, 2011

* Deadline for Opposition Briefing: August 29, 2011

* Final Pretrial Conference: November 14, 2011

* Jury Trial (9 days): November 29, 2011

d.Plaintiff's attempt to amend its complaint through supplemental discovery answers

During discovery, Defendants issued interrogatories requesting identification of each allegedly infringed patent claim and Plaintiff answered with specific claim numbers. On August 8, 2011, when Defendants filed for summary judgment, Plaintiff's answers to Defendants' interrogatories were as follows: (1) Claim 9 of the '928 Patent; (2) Claims 1 through 5 of the '029 Patent; and (3) Claims 3 and 4 of the '640 Patent. See Lauson Decl. (Dkt. 284) Ex. A (Claim 9 of the '928 Patent), Ex. B (Claims 3 and 4 of the '640 Patent); Dickie Decl. (Dkt. 266-1) Ex. J at 143 (Claims 1 through 5 of the '029 Patent).

On August 18 and 19, 2011-10 days after Defendants' Summary Judgment motion was due and four weeks after discovery ended-Plaintiff filed supplemental answers to Defendants' interrogatories. See Lauson Decl. (Dkt. 284) Ex. A, Ex. B. Plaintiff added the following bases for infringement: (1) Claim 2 of the '928 Patent; and (2) Claims 25 through 27 of the '640 Patent. Lauson Decl. (Dkt. 284) Ex. A, Ex. B.

e.Plaintiff's statements to the PTO regarding the '029 Patent

During at least part of the present litigation, Plaintiff's '029 Patent was also subjected to accelerated reexamination by the PTO. Claim 5 of the '029 Patent was not subject to reexamination. However, during reexamination of Claims 1 through 4 of the '029 Patent claims, Plaintiff stated that:

Claim 5 . . . further limits claim 4 by requiring rotation of the blade cover to cause the pawl to travel along the trigger pathway. Although causing a rod or strut to move due to pivoting a blade cover is considered known per se, it is not considered known within the bounds of the claims 4 and 1. Claim 5 is considered not have separate patentability outside the scope of claims 4 or 1.

Dickie Decl. (Dkt. 266-1) Ex. C 33-34 (quotation from Plaintiff's Amended Accelerated

Examination Support Document).

Plaintiff also repeatedly distinguished the '029 Patent from prior art by arguing before the PTO that only the '029 patent disclosed a "trigger pathway." See Dickie Decl. (Dkt. 266-1), Ex. C at 31.

f.Relevant limitations in the allegedly infringed patent claims and Defendants' RSC-432

i.Claim 5 of the '029 Patent

Claim 5 of the '029 Patent discloses a knife with the limitation "wherein rotation of the blade cover cause[s] the travel of . . . at least a portion of the pawl along the trigger pathway."

ii.Claim 3 of the '640 Patent

Claim 3 of the '640 Patent discloses a knife with the limitation "wherein the locking action of the cutting tool is provided by a strut which is pivotally joined to the guard member, the distal end of the strut being arranged to follow a ...


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