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Contour IP Holding, LLC v. Gopro, Inc.

United States District Court, N.D. California

January 9, 2020

CONTOUR IP HOLDING, LLC, Plaintiff,
v.
GOPRO, INC., Defendant.

          ORDER ON THE SCOPE OF IPR ESTOPPEL AND ON GOPRO'S MOTION FOR LEAVE TO AMEND INVALIDITY CONTENTIONS RE: DKT. NOS. 313, 316

          William H. Orrick United States District Judge.

         After a stay pending inter partes review (“IPR”), this patent infringement case has resumed with new counsel and new vigor. Before me is defendant GoPro, Inc.'s motion to amend its invalidity contentions, which plaintiff Contour IP Holdings, LLC opposes in part. The parties also ask that I determine the impact of IPR estoppel on GoPro's case. As set forth below, I grant in part and deny in part GoPro's motion to amend and provide the parties with guidance on estoppel.

         BACKGROUND

         In November 2014, the Patent Office issued U.S. Patent Nos. 8, 890, 954 (“the '954 Patent”) and 8, 896, 694 (“the '694 Patent”) to non-party Contour LLC. The patents claimed a priority date of September 13, 2010, making the one-year period for prior art September 13, 2009. Contour LLC, as the then-assignee of the patents, sued GoPro in the United States District Court for the District of Utah in January 2015 alleging infringement of both patents. See Contour, LLC v. GoPro, Inc., et al., Case No. 2:14-cv-864 (D. Utah 2015).

         In April 2015, GoPro filed IPR petitions challenging the validity of the '954 and '694 Patents. See Dkt. No. 270-4. In October 2015, the Patent Trial and Appeal Board (“PTAB”) granted GoPro's IPR petitions, finding that it was reasonably likely that claims 1, 2, and 11-30 of the '954 Patent and claims 1-20 of the '694 Patent were not patentable. When GoPro moved for a stay, Contour LLC voluntarily dismissed the Utah case on November 30, 2015. See Utah Dkt. No. 57. That same day, however, Contour filed a similar action against GoPro in the United States District Court for the District of Delaware. See Contour IP Holding, LLC v. GoPro, Inc., Case No. 1:15-cv-1108 (D. Del. 2015). GoPro filed a second motion for a stay pending IPR proceedings, and the court stayed the case in July 2016. See Del. Dkt. No. 70. In October 2016, the PTAB issued a final decision against GoPro's allegations that the claims were unpatentable, GoPro appealed that decision to the Federal Circuit. See GoPro, Inc., v. Contour IP Holding LLC, No. 2017-1894 (Fed. Cir.) [Dkt. No. 1].

         Meanwhile, the Delaware court lifted the stay, and in November 2016 GoPro filed a motion to transfer venue to this district. See Del. Dkt. No. 83. GoPro served its initial invalidity contentions on December 23, 2016. Dkt. No. 311-2. In July 2017, the Delaware court granted the motion to transfer, and the case was assigned to me. See Del. Dkt. No. 174; Dkt. No. 180. In November 2017 I denied GoPro's motion to dismiss. Dkt. No. 213. GoPro served supplemental invalidity contentions on February 9, 2018 and final invalidity contentions on April 2, 2018. Dkt. Nos. 311-3, 311-4. The contentions were the result of commissioned searches along with internal evidence of prior art and prior invention. Declaration of Michelle Ann Clark (“Clark Decl.”) [Dkt. No. 313-1] ¶ 2. On July 16, 2018 I construed the claims of the two patents at issue. See Claim Construction Order [Dkt. No. 251].

         On July 27, 2018, the Federal Circuit vacated and remanded the PTAB's decision, and on November 1, 2018 it denied Contour's combined petition for rehearing and rehearing en banc. See Gopro, Inc. v. Contour IP Holding LLC, 898 F.3d 1170, 1177 (Fed. Cir. 2018), opinion modified and superseded, No. 2017-1894, 2018 WL 5660650 (Fed. Cir. Nov. 1, 2018), and opinion withdrawn on denial of reh'g sub nom. GOPRO, INC., v. CONTOUR IP HOLDING LLC, No. 2017-1894, 2018 WL 5777326 (Fed. Cir. Nov. 1, 2018). On December 12, 2018, I granted GoPro's motion to stay pending IPR, finding that a ruling from the PTAB on remand was likely to simplify the issues in this case. Dkt. No. 286.

         On July 31, 2019, the PTAB issued its final written decision on remand. Clark Decl. Ex. M (July 31, 2019 PTAB Decision on Remand) [Dkt. No. 313-14]. On September 17, 2019, GoPro retained new counsel from Quinn Emmanuel Urquhart & Sullivan, LLP. Clark Decl. ¶ 4. New counsel “began looking for and engaged experts to look for prior art systems that would not be subject to 35 U.S.C. § 315(e).” Id.

         The parties then stipulated to lift the stay as of October 1, 2019. Dkt. No. 295. Within 48 hours, GoPro produced evidence to Contour from its new counsel's search. Clark Decl. ¶ 4. On October 29, 2019 GoPro provided Contour with its proposed amended invalidity contentions, which included new systems for use as primary references. Id. ¶ 5. GoPro also served third-party subpoenas to various entities seeking additional evidence of invalidity. Id. ¶ 6.

         On November 13, 2019, GoPro filed the instant motion, and on November 26, 2019, the parties filed a joint statement regarding IPR estoppel. See Motion to Amend Invalidity Contentions (“Mot.”) [Dkt. No. 313]; Joint Statement Regarding Estoppel (“Estoppel Statement”) [Dkt. No. 316]. I heard argument on January 8, 2020. Dkt. No. 332.

         LEGAL STANDARD

         I. MOTION TO AMEND

         “Patent Local Rule 3 requires patent disclosures early in a case and streamlines discovery by replacing the series of interrogatories that parties would likely have propounded without it.” ASUS Computer Int'l v. Round Rock Research, LLC, No. 12-cv-02099-JST, 2014 WL 1463609, at *1 (N.D. Cal. Apr. 11, 2014) (internal quotation marks and modifications omitted). The disclosures required under Rule 3 are designed “to require parties to crystallize their theories of the case early in the litigation and to adhere to those theories once they have been disclosed.” Nova Measuring Instruments Ltd. v. Nanometrics, Inc., 417 F.Supp.2d 1121, 1123 (N.D. Cal. 2006). “They are also designed to provide structure to discovery and to enable the parties to move efficiently toward claim construction and the eventual resolution of their dispute.” Golden Bridge Tech. Inc. v. Apple, Inc., No. 12-cv-04882-PSG, 2014 WL 1928977, at *3 (N.D. Cal. May 14, 2014) (internal quotation marks omitted); see also O2 Micro Int'l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d 1355, 1365-66 (Fed. Cir. 2006) (“The local patent rules in the Northern District of California [require] both the plaintiff and the defendant in patent cases to provide early notice of their infringement and invalidity contentions, and to proceed with diligence in amending those contentions when new information comes to light in the course of discovery. The rules thus seek to balance the right to develop new information in discovery with the need for certainty as to the legal theories.”).

         Patent Local Rule 3-6 permits amendment of infringement contentions only by order of the Court, and only upon a “timely showing of good cause.” Patent L.R. 3-6. Rule 3-6 lists several examples of “circumstances that may, absent undue prejudice to the nonmoving party, support a finding of good cause.” Id. These include:

(a) A claim construction by the Court different from that proposed by the party seeking amendment; (b) Recent discovery of material, prior art despite earlier diligent search; and (c) Recent discovery of nonpublic information about the Accused Instrumentality which was not discovered, despite diligent efforts, before the service of the Infringement Contentions.

Id. In determining whether a party has established good cause, courts first look to whether the party has shown that it has acted with diligence. See O2 Micro, 467 F.3d at 1366. “[I]f the moving party was not diligent, the inquiry should end.” Apple Inc. v. Samsung Electronics Co. Ltd., No. 12-cv-0630-LHK (PSG), 2013 WL 3246094, at *1 (N.D. Cal. June 26, 2013) (internal quotation marks omitted). On the other hand, “[i]f the court finds that the moving party has acted with diligence, it must then determine whether ...


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