United States District Court, S.D. California
ORDER: (1) GRANTING PLAINTIFF’S REQUEST FOR
JUDICIAL NOTICE, AND (2) DENYING DEFENDANT’S MOTION TO
DISMISS (ECF No. 10)
L. Sammartino United States District Judge.
before the Court is Defendant Moderustic Inc.’s Motion
to Dismiss for Lack of Subject Matter Jurisdiction Pursuant
to Rule 12(b)(1). (ECF No. 10.) Also before the Court are
Plaintiff American Fireglass’s Opposition to (ECF Nos.
12, 13) and the Defendant’s Reply in
Support of (ECF No. 14) the MTD, as well as Plaintiff’s
Request for Judicial Notice (RJN, ECF No. 12-15). The Court
vacated the hearing and took this matter under submission
without oral argument pursuant to Civil Local Rule 7.1(d)(1).
(ECF No. 16.) Having considered the parties’ arguments
and the law, the Court GRANTS Plaintiff’s RJN (ECF No.
12-15) and DENIES Defendant’s MTD (ECF No. 10).
2005, Plaintiff has manufactured and sold pieces of broken
tempered glass for use in fireplaces and fire pits. (Compl.
¶¶ 1, 9, ECF No. 1; see also Decl. of Matt
Doll (Doll Decl.) ¶ 2, ECF No. 12-1.) Defendant is
Plaintiff’s competitor and also sells fireplace and
fire pit glass. (Compl. ¶ 1, ECF No. 1; see
also Doll Decl. ¶ 4, ECF No. 12-1.)
founder, Ed Jaunzemis, filed a patent application seeking to
patent a process related to tumbled, polished, vibrated
broken tempered glass pieces in 2005. (Compl. ¶ 10, ECF
No. 1; see also Decl. of Charles F. Reidelbach
(Reidelbach Decl.) ¶ 2, ECF No. 13-1.) In 2011, the U.S.
Patent and Trademark Office (PTO) issued U.S. Patent No. 7,
976, 360 (the ’360 Patent). (Id.) After the
’360 Patent issued, Plaintiff filed an inter
partes review petition with the PTO. (Id.) In
2011, the PTO rejected all of the claims of the ’360
Patent as obvious in light of prior art. (Id.)
Defendant has appealed that ruling to the Federal Circuit.
(Id.) Defendant has also filed other, related patent
applications, one of which has been rejected and abandoned,
and two of which are pending and awaiting reexamination.
11, 2011, while the ’360 Patent was pending, Defendant
filed another patent application which was granted, resulting
in the issuance of U.S. Patent No. 8, 419, 505 (the
’505 Patent) on April 16, 2013. (Id. at ¶
11; see also MTD 3,  ECF No. 10; Reidelbach Decl.
¶ 3, ECF No. 13-1.) Defendant failed to disclose to the
PTO during prosecution of the ’505 Patent that the
’360 Patent had been rejected based on prior art.
(Reidelbach Decl. ¶ 3, ECF No. 13-1.) Plaintiff’s
counsel, Charles F. Reidelbach, even sent several letters to
Defendant’s attorney of record advising him and his
client of their duty of candor and good faith in dealing with
the PTO. (Reidelbach Decl. ¶ 4, ECF No. 13-1.)
issued an ex parte reexamination certificate of the
’505 Patent on November 26, 2014, which narrowed the
claims to include a method for creating smooth, tempered
glass pieces by placing the pieces into a tumbling apparatus
and tumbling the fragments for a pre-determined period of
time such that the surfaces of the glass fragments are
smoother than prior to tumbling and have a substantially
rounded, bead-like shape. (Compl. ¶ 11, ECF No. 1;
see also MTD 3, ECF No. 10; Reidelbach Decl. ¶
4, ECF No. 13-1.)
behalf of Defendant, Mr. Jaunzemis sent a series of emails to
Plaintiff’s dealers in February 2015, attaching a copy
of the ’505 Patent and threatening to file a complaint
for patent infringement against Plaintiff’s dealers.
(Compl. ¶ 13(a), ECF No. 1; see also Doll Decl.
Ex. A, ECF No. 12-2; Doll Decl. Ex. B, ECF No. 12-3.) One
email, for example, noted “we [Defendant] are and have
started enforcing our patent rights. You will or may be
notified by our legal team. Good luck with that. Let me know
how that works out for you.” (Doll Decl. Ex. B at 7,
ECF No. 12-3 at 3.) Plaintiff’s dealers forwarded the
emails to Plaintiff. (See Doll Decl. Ex. A, ECF No.
12-2; Doll Decl. Ex. B, ECF No. 12-3.) Mr. Jaunzemis claims
that he was unaware that these companies were dealers of
Plaintiff at the time. (Reply Declaration of Edgar Jaunzemis
(Jaunzemis Reply Decl.) ¶ 6), ECF No. 14-1.)
2015, Defendant filed a complaint for infringement of the
’505 Patent against various sellers of fireplace glass.
(Compl. ¶ 13, ECF No. 1; see also Decl. of
Edgar Edward Jaunzemis (Jaunzemis Decl.) ¶ 4(b), ECF No.
10-1.) Since filing that initial lawsuit, Defendant also has
threatened repeatedly to sue Plaintiff and its dealers for
infringement of the ’505 Patent. (Compl. ¶¶
1, 13, ECF No. 1.)
September 2015, for example, Plaintiff’s CEO Matt Doll
attended a convention in Chicago, at which representatives
from other companies informed him that Defendant had sued or
had threatened to sue their companies for patent
infringement. (Doll Decl. ¶ 6, ECF No. 12-1.)
October 2015, Mr. Jaunzemis was interviewed for a newspaper
article, which reported that Mr. Jaunzemis intended to hire
dozens of attorneys nationwide to sue a multitude of
companies for infringement of the ’505 Patent.
(Id. at ¶ 13(b); see also Doll Decl.
Ex. C, ECF No. 12-4.) Mr. Jaunzemis claims that he was not
given the opportunity to edit what was printed and contests
the accuracy of the statements attributed to him. (Jaunzemis
Decl. ¶ 4, ECF No. 10-1.) Nevertheless, Defendant posted
a copy of the article on its website and circulated a link to
the article to Plaintiff’s dealers. (Doll. Decl. ¶
7, ECF No. 12-1; see also Doll Decl. Ex. D, ECF No.
12-5; Doll Decl. Exs. E-H, ECF Nos. 12-6-9.)
October 2015, Mr. Jaunzemis sent a letter to Mr. Doll and his
wife on behalf of Defendant, threatening to sue
Plaintiff’s dealers. (Compl. ¶ 13(c), ECF No. 1;
see also Jaunzemis Decl. Ex. A, ECF No. 10-2; Doll
Decl. ¶ 8, ECF No. 12-1; Doll Decl. Ex. I, ECF No.
12-10.) The letter warned:
Now for a reality check, most likely you will never be in
court with your opponent. In a strategy session, I learned to
divide and conquer from within. How many dealers do you have?
How many dealers are in harm’s way? What if 10 of your
dealers get sued in 10 different states? . . . What if they
lose? They will be looking for indemnification from you, can
you afford that? . . . OK, now that the first ten get wiped
out, then the onslaught of another 20? 30? 40? When will you
get the message? How many suits can you afford? . . . At what
cost will you concede? When you have won and have nothing
left, what then?”
(Jaunzemis Decl. Ex. A, ECF No. 10-2 at 2; Doll Decl. Ex. I
at 27, ECF No. 12-10 at 2; see also Compl. ¶
13(c), ECF No. 1; Doll Decl. ¶ 8, ECF No. 12-1.) Mr.
Jaunzemis disputes that this letter may be attributed to him.
(Jaunzemis Decl. ¶ 5, ECF No. 10-1.) Although the
envelope shows a return address of 3050 Painfield [sic] Road,
Kettering, OH 45432, the letter was postmarked in Los Angeles
area on October 1, 2015. (Jaunzemis Decl. Ex. A, ECF No. 10-2
at 3; Doll Decl. Ex. I at 28, ECF No. 12-10 at 3.) Defendant
is a California corporation. (Compl. ¶ 4, ECF No. 1.)
Another seller of fireglass products, Hearth Products
Controls Company, is located at 3050 Plainfield Road,
Kettering, OH, but representatives of that company have
assured Mr. Doll that their company did not send the letter.
(Doll Decl. ¶ 8 & n.1, ECF No. 12-1.)
Mr. Jaunzemis sent a package to Plaintiff on behalf of
Defendant in December 2015, which enclosed copies of the
’360 and ’505 Patents and stated that Plaintiff
should consider the accompanying letter notice of
Defendant’s patent rights. (Compl. ¶ 13(d), ECF
No. 1; see ...