Finjan, Inc. v. Juniper Network, Inc.

Filing 85

ORDER GRANTING IN PART AND DENYING IN PART 67 MOTION FOR LEAVE TO AMEND COMPLAINT by Judge William Alsup. Amended Pleadings due by 5/18/2018. (whalc2, COURT STAFF) (Filed on 5/11/2018)

1
2
3
4
5
6

IN THE UNITED STATES DISTRICT COURT

7
FOR THE NORTHERN DISTRICT OF CALIFORNIA
8
9
FINJAN, INC.,

11
For the Northern District of California

United States District Court

10

12
13
14

Plaintiff,
v.

ORDER GRANTING IN PART
AND DENYING IN PART
MOTION FOR LEAVE TO
AMEND COMPLAINT

JUNIPER NETWORKS, INC.,
Defendant.
/

15
16
17

No. C 17-05659 WHA

INTRODUCTION
In this patent infringement action, plaintiff moves for leave to amend the complaint.

18

The motion is GRANTED IN PART and DENIED IN PART.

19

STATEMENT

20

Plaintiff Finjan, Inc., accuses defendant Juniper Networks, Inc., of infringing patents

21

pertaining to malware-detection technology. Finjan’s allegations have been summarized in a

22

prior order dated February 14, which dismissed Finjan’s claims of willfulness and induced

23

infringement but allowed Finjan to move for leave to amend by February 22 (Dkt. No. 30 at 8).

24

Finjan decided not to seek leave to amend to cure the deficiencies in those claims (see Dkt. No.

25

31 at 2). A case management order dated February 23 then provided, among other things, that

26

leave to amend pleadings must be sought by May 31 (Dkt. No. 35 at 1). The case management

27

order also set forth a procedure whereby each side will move for early summary judgment on

28

one claim by June 7 (id. at 4).

1

On April 6, Finjan moved via discovery letter to compel discovery regarding a Juniper

2

product called Advanced Threat Prevention Appliance (“ATP Appliance”) (Dkt. No. 48).

3

Another order denied that motion because the complaint did not properly identify ATP

4

Appliance as an accused product and Finjan had not successfully amended — or even moved to

5

amend — the complaint to accuse ATP Appliance (see Dkt. No. 69). Finjan then filed the

6

instant motion for leave to amend the complaint and add ATP Appliance as an accused product

7

(Dkt. No. 67). This order follows full briefing and oral argument.

8
9

ANALYSIS
Juniper does not oppose allowing Finjan to amend the complaint to add ATP Appliance
as an accused product. Juniper protests, however, that Finjan’s proposed amendment would

11
For the Northern District of California

United States District Court

10

(1) improperly revive Finjan’s dismissed “willfulness” allegations and (2) unfairly prejudice

12

Juniper in the early summary judgment procedure already well underway (see Dkt. No. 77 at 1).

13

1.

14

As the February 14 order noted, the original complaint alleged in boilerplate language

ALLEGATIONS OF WILLFULNESS.

15

that “Juniper ‘has acted recklessly and continues to willfully, wantonly, and deliberately engage

16

in acts of infringement’ of all eight patents-in-suit such that enhanced damages and attorney’s

17

fees are justified under Sections 284 and 285, respectively, of Title 35 of the United States

18

Code” (Dkt. No. 30 at 3). That order agreed with Juniper that Finjan had not alleged sufficient

19

facts to show willfulness under Section 284 (id. at 4–7). Juniper therefore takes issue with the

20

fact that Finjan’s proposed amendment contains the exact same boilerplate allegations,

21

complete with citations to Sections 284 and 285, despite the dismissal of Finjan’s willfulness

22

allegations (compare, e.g., Dkt. No. 1 at 25–26 with Dkt. No. 67-3 at 26).

23

Finjan’s reply is muddled but seems to be that, while it no longer seeks “enhanced

24

damages” under Section 284 for willful infringement, it continues to seek “enhanced damages”

25

under Section 284 and fee-shifting under Section 285 for Juniper’s “subjective bad faith” in this

26

litigation (see Dkt. No. 78 at 1, 4). First, Finjan cannot reassert dismissed allegations verbatim

27

simply by dressing them up in attorney argument and pretending this somehow qualitatively

28

changes the nature of the allegations. Second, none of Finjan’s cited authorities support its
2

1

suggestion that allegations insufficient to state a claim for willful infringement under Section

2

284 can nevertheless suffice to state a claim for some other kind of nebulous “willfulness”

3

under the same. Neither the February 14 order nor the authorities cited therein made any such

4

distinction. See WBIP, LLC v. Kohler Co., 829 F.3d 1317, 1341 (Fed. Cir. 2016) (“Knowledge

5

of the patent alleged to be willfully infringed continues to be a prerequisite to enhanced

6

damages.”). Under these circumstances, this order agrees with Juniper that Finjan has no

7

excuse for reasserting dismissed allegations of “willfulness” in service of any supposed claim

8

for “enhanced damages” under Section 284.*

9

Fee-shifting under Section 285 presents a different question, and one that would be
premature to consider at this stage. Possibly, by the end of this litigation, Finjan could emerge

11
For the Northern District of California

United States District Court

10

the “prevailing party” and establish entitlement to reasonable attorney’s fees by virtue of this

12

having been an “exceptional” case. The allegations in question, however, nudge us no closer to

13

that possibility. As the February 14 order explained, Finjan’s “willfulness” allegations simply

14

fail to show that Juniper did anything wrong. “[E]ven viewed in the light most favorable to

15

Finjan, [they] show at most that Juniper gave Finjan less attention than Finjan felt it deserved”

16

and was unwilling “to spend more time and energy rebutting what it perceived to be meritless

17

accusations of infringement” (see Dkt. No. 30 at 5–7). This remains true whether Finjan’s

18

allegations are considered for “enhanced damages” purposes under Section 284 or fee-shifting

19

purposes under Section 285. In short, Finjan’s intent to eventually seek attorney’s fees under

20

Section 285 cannot justify its present attempt to reassert dismissed allegations of “willfulness.”
IMPACT ON EARLY SUMMARY JUDGMENT PROCEDURE.

21

2.

22

Even by Finjan’s own account, it could have sought to properly accuse ATP Appliance

23

by, at the latest, February 2018 (see Dkt. No. 67 at 4). Instead, it brought the instant motion for

24

leave to amend on April 19 — approximately halfway through the time allotted for early

25

summary judgment motions. Although the parties do not dispute that leave to amend should be

26
27
28

*
This order recognizes that the February 14 order dismissing Finjan’s “willfulness” allegations
applied only to products accused in the operative complaint at that time. The conclusion herein is not that
Finjan had no way to amend to plead willful infringement as to the newly-accused ATP Appliance product, but
rather that Finjan has not done so here because the allegations of “willfulness” in the proposed amendment
remain identical to the dismissed allegations of “willfulness” from the original complaint.

3

1

granted, this order agrees with Juniper that allowing Finjan to shake up the playing field for the

2

early summary judgment procedure at this time would be unduly prejudicial to Juniper.

3

Finjan raises several arguments, none persuasive. First, Finjan contends Juniper will

4

not be prejudiced because it has been aware of Finjan’s intent to accuse ATP Appliance since

5

February 2018, when Finjan first mentioned the product in its infringement contentions (see

6

Dkt. Nos. 67 at 8–9, 78 at 2). But Juniper had no obligation to shape its early summary

7

judgment strategy around new products mentioned in infringement contentions, as opposed to

8

what had actually been accused in the operative complaint. Second, Finjan contends Juniper

9

will lose no preparation time because discovery has been ongoing, and the first deposition
would not have taken place until May 9 anyway (see Dkt. No. 67 at 8–9). None of this changes

11
For the Northern District of California

United States District Court

10

the fact that half of Juniper’s preparation time has already elapsed, and Juniper may have used

12

that time or planned its discovery strategy differently had it known it would be defending ATP

13

Appliance in the early summary judgment procedure. Third, Finjan points out that Juniper

14

possesses all evidence pertaining to ATP Appliance, “should be able to collect the most relevant

15

evidence . . . in manner [sic] of days,” and would need to produce that evidence eventually

16

anyway if leave to amend is granted (id. at 9; see also Dkt. No. 78 at 2–3). These observations

17

suggest Juniper may be able to mitigate the prejudice that would flow from Finjan’s proposed

18

amendment but fail to justify imposing that prejudice on Juniper in the first place. Fourth,

19

Finjan contends Juniper’s opposition brief constitutes an “improper request for relief” since

20

Juniper agreed to allow the proposed amendment, so any request to exclude ATP Appliance

21

from the early summary judgment procedure must be teed up via a separate motion (Dkt. No. 78

22

at 1–2). Nonsense. Juniper was within its rights to take the position that it would not oppose

23

amendment subject to certain conditions, and it certainly remains within the purview of this

24

order to grant leave to amend subject to the requested conditions.

25

In summary, all agree that Finjan should be allowed to add ATP Appliance as an

26

accused product. This order agrees with Juniper, however, that Finjan’s proposed amendment

27

revives dismissed “willfulness” allegations, and further agrees that ATP Appliance cannot in

28

fairness be included in the early summary judgment procedure already well underway —
4

1

although Finjan may of course include ATP Appliance in subsequent rounds of the early

2

summary judgment procedure going forward. This order therefore GRANTS leave to amend on

3

the conditions that (1) Finjan removes its dismissed “willfulness” allegations and (2) ATP

4

Appliance remains excluded from the first round of the early summary judgment procedure.

5
6

CONCLUSION
For the foregoing reasons, plaintiff’s motion for leave to amend is GRANTED IN PART

7

and DENIED IN PART. Plaintiff may file an amended complaint consistent with this order by

8

MAY 18 AT NOON. Discovery that plaintiff previously propounded regarding ATP Appliance

9

shall be deemed served as of the filing date of the amended complaint.

11
For the Northern District of California

United States District Court

10
IT IS SO ORDERED.

12
13

Dated: May 11, 2018.

WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE

14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
5