Aeritas, LLC v. Alaska Air Grp., Inc.

893 F.Supp.2d 680

AERITAS, LLC, Plaintiff,

v.ALASKA AIR GROUP, INC., Defendant.

Civ. No. 11–967–SLR.

United States District Court, D. Delaware.

Sept. 28, 2012.

Richard D. Kirk, Esquire, and Stephen B. Brauerman, Esquire, of Bayard, P.A., Wilmington, DE, of Counsel: Marc A. Fenster, Esquire, Andrew D. Weiss, Esquire, and Branden D. Frankel, Esquire, of Russ, August & Kabat, for Plaintiff.

Jeffrey L. Moyer, Esquire, Kelly E. Farnan, Esquire, Jason J. Rawnsley, Esquire, and Jaclyn C. Levy, Esquire, of Richards, Layton & Finger, P.A., Wilmington, DE, for Defendant.

MEMORANDUM OPINION

SUE L. ROBINSON, District Judge.

I. INTRODUCTION

Plaintiff Aeritas, LLC (“Aeritas”) filed a complaint on October 13, 2011, alleging infringement of U.S. Patent Nos. 7,933,589 (“the '589 patent”) and 7,209,903 (“the '903 patent”) by Alaska Air Group, Inc. (“AAG”). (D.I. 1) On December 9, 2011, in lieu of an answer, AAG moved to dismiss the complaint. (D.I. 8) In response, Aeritas filed a first amended complaint, mooting AAG's motion. (D.I. 10) AAG moved to dismiss the first amended complaint on January 20, 2012. (D.I. 13) For the reasons that follow, the court grants in part and denies in part AAG's motion.

II. BACKGROUND

In its original complaint, Aeritas alleged that AAG is “directly and/or jointly infringing, and indirectly infringing by way of inducing infringement and/or contributing to the infringement” of the patents-in-suit. (D.I. 1 at ¶¶ 7, 12) Aside from the foregoing generic allegation, joint infringement was not separately described. Aeritas also pleaded that, “[t]o the extent that facts learned in discovery show that [AAG's] infringement of the [patents-in-suit] was willful, Aeritas reserves the right to request such a finding at [the] time of trial.” ( Id. at ¶¶ 8, 13)

Three months later, Aeritas amended the complaint. The amended complaint asserts that AAG has “knowingly contributed to the infringement, and continues to contribute to the infringement of one or more claims of the [patents-in-suit] by offering its products to its customers,” i.e., “by offering to its customers use of its mobile software, which constitutes a material part of the invention and is not a staple article or commodity of commerce suitable for substantial noninfringing use.” (D.I. 10 at ¶¶ 7, 13) Aeritas limits its allegations of indirect infringement to the period following service of the complaint. ( Id.)

The same is averred with respect to AAG's claim of induced infringement, which is alleged to be occurring “with specific intent that its software be used by [its] customers to infringe the [patents-in-suit].” ( Id.) Aeritas has added claims of joint infringement which state that,

[t]o the extent that [AAG] is jointly infringing one or more of the claims of the [patents-in-suit] with one or more third parties, [AAG] exercises control or direction over the infringement such that it is the mastermind of the infringement. On information and belief, [AAG's] mastermind relationship is derived from a contractual relationship with the one or more third parties to provide the infringing services and/or system at the control or direction of [AAG].

( Id. at ¶¶ 8, 14) Finally, Aeritas alleges that AAG's “acts of infringement have been willful under 35 U.S.C. § 284 since at least the date it was served with the complaint in this action.” ( Id. at ¶¶ 9, 15) No additional specifics with respect to willfulness are provided.

III. STANDARD

In reviewing a motion filed under Federal Rule of Civil Procedure 12(b)(6), the court must accept all factual allegations in a complaint as true and take them in the light most favorable to plaintiff. See Erickson v. Pardus, 551 U.S. 89, 94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007); Christopher v. Harbury, 536 U.S. 403, 406, 122 S.Ct. 2179, 153 L.Ed.2d 413 (2002). A court may consider the pleadings, public record, orders, exhibits attached to the complaint, and documents incorporated into the complaint by reference. Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007); Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d 1380, 1384–85 n. 2 (3d Cir.1994). A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the defendant fair notice of what the ... claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 545, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (interpreting Fed.R.Civ.P. 8(a)) (internal quotation marks omitted). A complaint does not need detailed factual allegations; however, “a plaintiff's obligation to provide the ‘grounds' of his entitle[ment] to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. (alteration in original) (citation omitted). The “[f]actual allegations must be enough to raise a right to relief above the speculative level on the assumption that all of the complaint's allegations are true.” Id. Furthermore, “[w]hen there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). Such a determination is a context-specific task requiring the court “to draw on its judicial experience and common sense.” Id.

IV. DISCUSSIONA. Indirect Infringement

1. Standards

The Federal Circuit has held that “Form 18 should be strictly construed as measuring only the sufficiency of allegations of direct infringement, and not indirect infringement.” In re Bill of Lading, 681 F.3d 1323, 1336 (Fed.Cir.2012). In that same case, the Court concluded that plaintiffs alleging indirect infringement need not name a specific customer “to adequately plead the predicate direct infringement,” so long as plaintiffs have pled “facts sufficient to allow an inference that at least one direct infringer exists.” Id. With respect to the remaining prongs of indirect infringement claims, the Federal Circuit has indicated that plaintiffs must provide “sufficient detail to satisfy the specificity requirement of Twombly and Iqbal.” Id. at 1337. Therefore, the court must undertake the “context-specific task” of determining whether Aeritas's amended complaint states a “plausible” claim for relief. Id.

With respect to allegations of induced infringement under 35 U.S.C. § 271(b), a plausible claim for relief must include facts sufficient to allow an inference that the alleged infringer has “knowledge that the induced acts constitute patent infringement.” Global–Tech Appliances, Inc. v. SEB S.A., ––– U.S. ––––, 131 S.Ct. 2060, 2068, 179 L.Ed.2d 1167 (2011). Therefore, to survive a motion to dismiss, a patentee must plead facts “plausibly showing that [the alleged infringer] specifically intended [its] customers to infringe the [patent-in-suit] and knew that the customer's acts constituted infringement.” In re Bill of Lading, 681 F.3d at 1339. In its decision in Walker Digital, LLC v. Facebook, Inc., 852 F.Supp.2d 559 (D.Del.2012), this court concluded that plaintiffs pleadings passed muster under Rule 8 of the Federal Rules of Civil Procedure by identifying the patent-at-issue and the allegedly infringing conduct, as well as the notice afforded by service of the original complaint and the apparent decision to continue the inducement post-service.

In the context of a claim of contributory infringement under 35 U.S.C. § 271(c), a patentee “must, among other things, plead facts that allow an inference that the components sold or offered for sale [by the alleged infringer] have no substantial non-infringing uses,” that is, uses that are “ ‘not unusual, far-fetched, illusory, impractical, occasional, aberrant, or experimental.’ ” In re Bill of Lading, 681 F.3d at 1337 (internal citation omitted). In Walker Digital, this court concluded that the patentee sufficiently pled its allegations of contributory infringement when it asserted that defendant: “(1) had knowledge of the patent; (2) sold products especially made for infringing use; (3) had knowledge of the infringing use; (4) sold products with no substantial non-infringing use; and (5) directly infringed.” 852 F.Supp.2d at 566–67.

2. Discussion

In this case, Aeritas has alleged in its amended complaint that, “after being served with the complaint in this action, [AAG] has induced infringement, and continues to induce infringement, of one or more claims of the [patents-in-suit], with specific intent that its software be used by [AAG's] customers to infringe the [patents-in-suit].” (D.I. 10 at ¶¶ 7, 13) With respect to contributory infringement, Aeritas has alleged that “[s]ince at least after being served with the [c]omplaint in this action, [AAG] has knowingly contributed to the infringement, and continues to contribute to the infringement of one or more claims of the [patents-in-suit] by offering its products to its customers, which constitute a material part of the invention and is not a staple article or commodity of commerce suitable for substantial non-infringing use.” ( Id. at ¶¶ 7, 13) Having identified the products at issue for purposes of its direct infringement claims, the court concludes that Aeritas has satisfied the pleading requirements of Twombly and Iqbal with respect to the allegations of indirect infringement found in the amended complaint.

B. Willful Infringement

1. Standards

To establish willful infringement,

a patentee must show by clear and convincing evidence that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent. The state of mind of the accused infringer is not relevant to this objective inquiry. If this threshold objective standard is satisfied, the patentee must also demonstrate that this objectively-defined risk (determined by the record developed in the infringement proceeding) was either...