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Comcast Cable Communications, LLC v. Opentv, Inc.

United States District Court, N.D. California

March 13, 2017

COMCAST CABLE COMMUNICATIONS, LLC, Plaintiff,
v.
OPENTV, INC., and NAGRAVISION SA, Defendants.

          ORDER GRANTING MOTION TO DISMISS; GRANTING IN PART MOTION TO STAY, DISMISS, OR TRANSFER; AND DENYING MOTION TO ENJOIN

          WILLIAM ALSUP UNITED STATES DISTRICT JUDGE

         INTRODUCTION

         In this patent infringement action, defendants move to dismiss counts one through ten of the amended complaint, and separately to stay, dismiss, or transfer counts 11 through 13 of the amended complaint to the Eastern District of Texas. Plaintiff moves to enjoin proceedings in the Eastern District of Texas. Defendants' motion to dismiss is Granted; defendants' motion to stay, dismiss, or transfer is Granted in part; and plaintiff's motion to enjoin is Denied.

         STATEMENT

         The following facts are taken from the amended complaint unless otherwise specified. Plaintiff Comcast Cable Communications, LLC, is a Delaware company with its principal place of business in Pennsylvania. Comcast provides video, Internet, and voice services under the XFINITY brand to both residential and business customers. OpenTV, Inc., is a Delaware corporation with its principal place of business in San Francisco, California. Nagravision SA is a Swiss company with its principal place of business in Switzerland; within the United States, its principal place of business is in El Segundo, California. Both OpenTV and Nagravision are subsidiaries of Kudelski SA, a Swiss firm. Together, OpenTV and Nagravision own the 13 patents at issue (Dkt. No. 24 at 1-2).

         Kudelski and its subsidiaries have a history of monetizing their patent rights through litigation. Examples include prior patent infringement actions filed against Netflix, Inc., in December 2012; Apple Inc. in April 2014 and May 2015; Verizon Communications, Inc., in October 2015; and Hulu LLC in March 2016. Other examples include actions for declaratory judgment of non-infringement filed against Kudelski and its subsidiaries by Yahoo! Inc. in January 2016 and Time Warner Cable, Inc., in May 2016, based on allegations that Kudelski and its subsidiaries had threatened litigation for purported patent infringement (id. at 3-4, 7).

         On October 1, 2015, Clay Gaetje, Vice President for Licensing at Kudelski, emailed David Marcus, Comcast's Chief Patent Counsel, “to start a dialogue about the licensing of Kudelski's patent portfolio to certain aspects of Comcast's pay television and over-the-top video services.” (Comcast describes this technology collectively as relating to its set-top boxes.) Following some correspondence between the two sides, on November 12, 2015, Gaetje sent Marcus a PowerPoint presentation titled, “Introductory Information Requested by Comcast” that described Kudelski's patent portfolio and highlighted “15 representative patents, covering most aspects of Comcast's video delivery and advertising services” (id. at 4-5).

         The November 2015 presentation dedicated two slides to each “representative” patent. The first slide listed basic information about the patent, including its inventors, priority date, expiration date, “Summary of Technology” (a summary of the patent's function), “Claim Mapping” (a list of Comcast products or services accused of infringing the patent), and “Exemplary Relevance” (a summary of how the patent allegedly worked in the accused Comcast products or services). The second slide recited a specific claim of the patent (ostensibly one allegedly met by the accused Comcast products or services) (Dkt. No. 24-2).[1]

         The 15 representative patents identified in the November 2015 presentation did not translate perfectly into the array of patents at issue in this action. On January 28, 2016, Judge Edward Davila found that claims of the ‘081 patent were invalid. OpenTV, Inc. v. Apple Inc., No. 5:15-cv-02008-EJD, 2016 WL 344845 (N.D. Cal. Jan. 28, 2016) (Judge Edward Davila). At a meeting between Marcus and Gaetje on the same day, and in anticipation of Judge Davila's ruling, defendants withdrew the ‘081 patent from their lineup. At that same meeting, defendants also indicated they did not intend to further discuss patents ‘117, ‘212, ‘256, ‘579, or ‘768. While presenting to Comcast representatives at the January 2016 meeting, however, defendants also introduced for the first time patent 6, 530, 082 (“the ‘082 patent”), another patent purportedly infringed by Comcast's products or services (Dkt. No. 24 at 6).

         On October 26, 2016, Comcast filed the instant action. The original complaint sought declaratory judgment of non-infringement as to patents ‘082, ‘139, ‘229, ‘322, ‘327, ‘328, ‘389, ‘461, ‘586, and ‘595 (Dkt. No. 1). Then, on December 5, 2016, Nagravision sued Comcast in the Eastern District of Texas for allegedly infringing three additional patents from Kudelski's portfolio - 8, 356, 188 (“the ‘188 patent”), 7, 725, 720 (“the ‘720 patent”), and 7, 725, 740 (“the ‘740 patent”). In response, on December 27, 2016, Comcast amended its complaint in the instant action to include claims for declaratory judgment of non-infringement as to patents ‘188, ‘720, and ‘740 as well (Dkt. No. 24 at 1, 7).

         On January 26, the parties filed the instant motions. Defendants move to dismiss counts one through ten of the amended complaint - corresponding to the ten patents carried over from defendants' November 2015 presentation and challenged in Comcast's original complaint (Dkt. No. 43). Defendants also move to stay, dismiss, or transfer counts 11 through 13 of the amended complaint to the Eastern District of Texas (Dkt. No. 44). Comcast opposes both motions and moves to enjoin proceedings in the Eastern District of Texas (Dkt. No. 45). This order follows full briefing and oral argument.

         ANALYSIS

         1. Defendants' Motion to Dismiss Counts One Through Ten.

         Defendants move to dismiss counts one through ten of the amended complaint for failing to state a claim under Rule 12(b)(6). Both sides acknowledge that, following the abrogation of Form 18 on December 1, 2015, Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), set forth the applicable pleading standard under Federal Rule of Civil Procedure 8 (Dkt. Nos. 43 at 1, 53 at 1). Under that standard, “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 570). Although a court deciding a motion to dismiss must accept as true all factual allegations in the complaint, it is not bound to accept as true legal conclusions couched as factual allegations. Thus, “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ibid.

         Here, counts one through ten in Comcast's amended complaint all follow the same format. Count eight, quoted in full below, is ...


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