Fox Factory, Inc. v. SRAM, LLC

Filing 101

ORDER GRANTING LEAVE TO AMEND INFRINGEMENT CONTENTIONS by Judge William H. Orrick re: (88) Motion to Amend/Correct in case 3:16-cv-00506-WHO and (76) Motion to Amend/Correct in case 3:16-cv-03716-WHO. (jmdS, COURT STAFF) (Filed on 10/17/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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FOX FACTORY, INC.,
Plaintiff,

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SRAM, LLC,
Defendant.

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United States District Court
Northern District of California

3:16-CV-03716-WHO

v.

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RELATED CASE NOS.
3:16-cv-00506-WHO AND

ORDER GRANTING LEAVE TO
AMEND INFRINGEMENT
CONTENTIONS
Re: Dkt. Nos. 88 (16-506), 76 (16-3716)

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INTRODUCTION

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Fox Factory, Inc. (“FOX”) seeks leave to update its infringement contentions to “reflect

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the current state of the case,” which entails incorporating changes from its recently amended

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complaints, removing infringement allegations related to a patent that is no longer asserted, adding

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accused products purportedly uncovered through the course of discovery, and adding its own

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products that practice the patents in suit. Defendants oppose FOX’s motion, largely focusing on

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FOX’s lack of diligence in pursuing the requested amendments. This matter is suitable for

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decision without oral argument, Civil L. R. 7-1(b), and the hearing scheduled for October 25, 2017

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is VACATED. Because the proposed changes will not prejudice the defendants, I GRANT FOX’s

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motions.

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BACKGROUND

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FOX served its initial Infringement Contentions in accordance with the case schedule and

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the patent local rules. Case No. 3:16-cv-00506-WHO (“FOX I”), Dkt. No. 35; Case No. 3:16-cv-

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03716-WHO (“FOX II”), Dkt. No. 27. In February, FOX filed a motion to amend its Infringement

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Contentions to (1) comply with recent changes to the Patent Local Rules, (2) add new accused

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SRAM products, (3) add a claim for willful infringement, (4) add earlier versions of FOX’s Float

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products, and (5) remove an infringement theory pertaining to FOX’s ’674 patent. FOX I, Dkt.

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No. 44.1 SRAM filed a statement of nonopposition. FOX I, Dkt. No. 45; FOX II, Dkt. No. 33. I

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granted the motions on February 28, 2017. FOX I, Dkt. No. 47; FOX II, Dkt. No. 34.

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FOX subsequently moved to file amended complaints in each action, which I granted in

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August. FOX I, Dkt. No. 78; FOX II, Dkt. No. 67. FOX filed its amended complaints the next

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day. FOX I First Am. Compl., Dkt. No. 79; FOX II, Second Am. Compl., Dkt. No. 68.
FOX now moves for leave to file amended infringement contentions to reflect

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developments since its prior contentions. In FOX I, it seeks to (1) add claims against Sandleford

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Limited (and all SRAM subsidiaries); (2) add four SRAM products accused of infringing the ’434

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United States District Court
Northern District of California

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patent; (3) identify additional FOX products practicing the ’434 patent; (4) revise the asserted

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priority date for the ’434 patent from February 3, 1998 to April 9, 1998 based on inventor

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testimony; and (5) remove infringement allegations pertaining to the ’674 patent. FOX I Mot. to

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Amend Infringement Contentions (“FOX I Mot.”), Dkt. No. 88. In FOX II, it seeks to (1) add

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claims against Sandleford Limited (and all SRAM subsidiaries); (2) add additional SRAM

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products accused of infringing the ’172 and ’009 patents; and (3) add the conception date to

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comport with its January 23, 2017 interrogatory responses. FOX II, Dkt. No. 76.
Fact discovery closes on December 20, 2017, expert discovery ends on March 30, 2018,

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and trial is set to begin September 10, 2018. FOX I, Dkt. No. 53; FOX II, Dkt. No. 41.
LEGAL STANDARD

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Under the Patent Local Rules, a party may amend its Infringement Contentions by order of

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the Court upon a timely showing of good cause. Patent L. R. 3-6. Examples that may support a

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finding of good cause absent undue prejudice to the non-moving party include:

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(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

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In FOX II, FOX sought to amend its Infringement Contentions only to comply with the recently
revised Patent Local Rules. FOX II, Dkt. No. 32.
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Instrumentality which was not discovered, despite diligent efforts,
before the service of the Infringement Contentions.

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Id.

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The Federal Circuit “agree[s] with the Northern District of California that ‘good cause’

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requires a showing of diligence.” O2 Micro Int'l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d

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1355, 1366 (Fed. Cir. 2006). The burden is on the movant to establish diligence. Id. However,

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“even if the movant was arguably not diligent,” courts may still grant leave to amend. E.g., Apple

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Inc. v. Samsung Elecs. Co., No. CV 12-00630 LHK, 2012 WL 5632618, at *5–6 (N.D. Cal. Nov.

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15, 2012)(allowing amendment absent diligence when omission appeared to be an “honest

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mistake” not motivated by gamesmanship and when “ample time left on the pretrial clock” and no
undue prejudice); The Bd. of Trustees of Leland Stanford Junior Univ. v. Roche Molecular Sys.,

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United States District Court
Northern District of California

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Inc., No. C 05-04158 MHP, 2008 WL 624771, at *3 (N.D. Cal. Mar. 4, 2008)(finding plaintiff’s

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“overall diligence was not insufficient” when it was diligent in notifying defendant, but not in

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pursuing amendment with the court).

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DISCUSSION
FOX seeks to amend its Infringement Contentions in FOX I to (1) add SRAM subsidiaries

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that allegedly make, sell, and ship the accused products; (2) add four SRAM products accused of

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infringing the ’434 patent; (3) identify additional FOX products practicing the ’434 patent; (4)

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revise the asserted priority date for the ’434 patent from February 3, 1998 to April 9, 1998 based

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on inventor testimony; and (5) remove infringement allegations pertaining to the ’674 patent.

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FOX I Mot. to Amend Infringement Contentions (“FOX I Mot.”), Dkt. No. 88. In FOX II, it seeks

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to (1) add SRAM subsidiaries that allegedly make, sell, and ship the accused products; (2) add

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additional SRAM products accused of infringing the ’172 and ’009 patents; and (3) add the

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conception date to comport with its January 23, 2017 interrogatory responses. FOX II, Dkt. No.

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76. Defendants’ cursory oppositions object to FOX’s attempts to add claims against Sandleford

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and all SRAM subsidiaries and to add certain accused products because these alterations could and

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should have been made sooner, and FOX’s failure to timely seek these amendments demonstrates

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a lack of diligence. FOX I Opp’n at 2, Dkt. No. 96; FOX II Opp’n at 2, Dkt. No. 84.

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FOX arguably lacked diligence in seeking some of its proposed amendments. The parties
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stipulated to remove the ’674 patent from FOX I nearly five months before FOX’s present

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motion.2 FOX I, Dkt. No. 56. And, it could and should have known earlier which of its own

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products purportedly practice the patents in suit. But it does not wish to add new patent claims or

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infringement theories, and defendants have not even argued that they are prejudiced by FOX’s

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proposed amendments. Under such circumstances, granting FOX’s motions would not contravene

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the goal of the patent local rules, which were “designed specifically to require parties to crystallize

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their theories of the case early in the litigation so as to prevent the ‘shifting sands’ approach to

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claim construction.” O2 Micro Int'l Ltd., 467 F.3d at 1364 (internal quotation marks omitted).

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FOX’s motions are GRANTED.
CONCLUSION

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In accordance with the foregoing, FOX’s motions to amend its infringement contentions in

United States District Court
Northern District of California

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these related cases are GRANTED.
IT IS SO ORDERED.

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Dated: October 17, 2017

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William H. Orrick
United States District Judge

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Defendants note FOX’s lack of diligence in removing infringement allegations related to the
’674 patent, but do not object to this proposed amendment. FOX I Opp’n at 2 n.1.
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