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J & K IP Assets, LLC v. Armaspec, Inc.

United States District Court, N.D. California

May 2, 2018

J & K IP ASSETS, LLC, Plaintiff,
v.
ARMASPEC, INC., Defendant.

          ORDER GRANTING MOTION TO DISMISS, RE: DKT. NO. 21

          William H. Orrick United States District Judge

         INTRODUCTION

         J & K IP Assets, LLC (“J & K”) accuses Armaspec, Inc. (“Armaspec”) of infringing U.S. Patent No. 8, 800, 424 (“the '424 patent”) by manufacturing, advertising, and selling its “Stealth Recoil Spring” buffer assembly. It adequately identifies the accused product, but it fails to sufficiently plead how the Stealth Recoil Spring infringes the '424 patent. While it need not identify the specific claim or provide an element-by-element comparison at this stage, it must provide some allegations to provide Armaspec with notice of how its product infringes J & K's patent. Its claims are DISMISSED WITH LEAVE TO AMEND.[1] J & K shall file an amended complaint within 20 days.

         BACKGROUND

         J & K holds the rights to the intellectual property of JP Enterprises, Inc., which manufactures and sells a broad range of firearms and firearm components. Compl. ¶ 8 (Dkt. No. 1). It alleges that Armaspec infringes the '424 patent, entitled “Capture Spring Assembly for a Firearm, ” by manufacturing, advertising, and selling its “Stealth Recoil Spring” buffer assembly. Id. ¶¶ 9-12. It also alleges that Armaspec has used the “Stealth Recoil Spring” buffer assembly “for purposes of demonstrations to customers and potential customers.” Id. ¶ 12. It brings claims for direct infringement, Compl. ¶ 17, indirect infringement by inducement, id. ¶¶ 19-23, and indirect contributory infringement, id. ¶¶ 24-25. It alleges willful infringement based on Armaspec's actual knowledge of its patent since at least June 6, 2017. Id. ¶¶ 18, 20, 25.

         LEGAL STANDARD

         Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible when the plaintiff pleads facts that “allow the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation omitted). There must be “more than a sheer possibility that a defendant has acted unlawfully.” Id. While courts do not require “heightened fact pleading of specifics, ” a plaintiff must allege facts sufficient to “raise a right to relief above the speculative level.” See Twombly, 550 U.S. at 555, 570.

         To state a claim for patent infringement, “a patentee need only plead facts sufficient to place the alleged infringer on notice. This requirement ensures that the accused infringer has sufficient knowledge of the facts alleged to enable it to answer the complaint and defend itself.” Phonometrics, Inc. v. Hosp. Franchise Sys., Inc., 203 F.3d 790, 794 (Fed. Cir. 2000).

         If the court dismisses the complaint, it “should grant leave to amend even if no request to amend the pleading was made, unless it determines that the pleading could not possibly be cured by the allegation of other facts.” See Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000). In making this determination, the court should consider factors such as “the presence or absence of undue delay, bad faith, dilatory motive, repeated failure to cure deficiencies by previous amendments, undue prejudice to the opposing party and futility of the proposed amendment.” See Moore v. Kayport Package Express, 885 F.2d 531, 538 (9th Cir. 1989).

         DISCUSSION

         I. ACCUSED PRODUCT

         Armaspec argues that J & K's complaint must be dismissed because it “inadequately identifies the accused product(s)[.]” Mot. to Dismiss at 3 (Dkt. No. 21)(capitalization omitted). After citing a bevy of cases for the proposition that J & K must identify the specific product accused of infringement, id. at 3-4, Armaspec acknowledges that J & K has identified a specific product (the Stealth Recoil Spring), but contends that “[i]t is not clear whether [p]laintiff is alleging that the ‘Stealth Recoil Spring' is the only Accused Product or whether Armaspec's other products also infringe.” Id. at 4. At this stage, J & K need not disclose each known accused product. E.g., Windy City Innovations, LLC v. Microsoft Corp., 193 F.Supp.3d 1109, 1115 (N.D. Cal. 2016)(“Additionally, defendant's argument that it should be entitled to notice at the pleading stage of which specific products infringed on which specific claims in the patents is belied by both the local patent rules and Federal Circuit authority.”). That information is required by the initial disclosures due not later than 14 days after the initial case management conference. Patent L. R. 3-1(b).

         II. DIRECT INFRINGEMENT

         Armaspec insists that J & K's allegations fail to state a claim for direct infringement because they “essentially regurgitate[] the requirements in 35 U.S.C. section 217[, ]” do not include an explanation of how the Stealth Recoil Spring “contains each and every limitation of the asserted claims[, ]” and include conclusory allegations that Armaspec itself has used the Stealth Recoil Spring in demonstrations to potential customers. Mot. at 4-5. J & K's complaint sufficiently alleged what Armaspec did to infringe the '424 patent as required under 35 U.S.C. section 217, but it does not adequately plead how Armaspec's Stealth Recoil Spring infringes. J & K need not allege how the Stealth Recoil Spring contains each and every limitation of the asserted claims (that specificity is reserved for initial disclosures), but it must allege some facts about the scope of the patent claims and how the Stealth Recoil Spring infringes. Compare Compl. ¶¶ 17, 19 (alleging only that certain products including the Stealth Recoil Spring are “within the scope of one or more claims of the '424 Patent), with Lifetime Indus., Inc. v. Trim-Lok, Inc., 869 F.3d 1372, 1379 (Fed. Cir. 2017)(finding allegations sufficient to state a claim for patent infringement when they included the where, when, who, and why of infringement); Windy City Innovations, LLC v. Microsoft Corp., Case No. 16-cv-01729-YGR, 193 ...


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