Streetspace, Inc v. Google, Inc. et al

Filing 39

RESPONSE re 35 Order to Show Cause, and Request for Leave to Amend its Complaint filed by Streetspace, Inc. (Fazio, James) (kaj).

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DOUGLAS E. OLSON (CSB NO. 38649)
[e-mail]
JAMES V. FAZIO, III (CSB NO. 183353)
[e-mail]
TREVOR Q. CODDINGTON, PH.D. (CSB NO. 243042)
[e-mail]
SAN DIEGO IP LAW GROUP LLP
12526 High Bluff Drive, Suite 300
San Diego, CA 92130
Telephone: [phone]
Facsimile: [phone]
Attorneys for Plaintiff
STREETSPACE, INC.

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UNITED STATES DISTRICT COURT
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SOUTHERN DISTRICT OF CALIFORNIA
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STREETSPACE, INC., a Delaware
corporation,
Plaintiff,

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vs.
GOOGLE INC., a Delaware corporation;
ADMOB, INC., a Delaware corporation;
APPLE INC., a California corporation;
QUATTRO WIRELESS, INC., a Delaware
corporation; NOKIA CORPORATION, a
foreign corporation; NOKIA INC., a
Delaware corporation; NAVTEQ
CORPORATION, a Delaware corporation;
MILLENNIAL MEDIA, INC., a Delaware
corporation; JUMPTAP, INC., a Delaware
corporation; and DOES 1 through 20,
inclusive,

CASE NO. 10-CV-1757-LAB-AJB
PLAINTIFF STREETSPACE, INC.’S
RESPONSE TO THE COURT’S
MARCH 3, 2011 ORDER TO SHOW
CAUSE, AND REQUEST FOR LEAVE
TO AMEND ITS COMPLAINT
Date:
Time:
Judge:
Ctrm:

March 14, 2011
11:15 a.m.
Hon. Larry A. Burns
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Defendants.
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STREETSPACE’S RESPONSE TO OSC AND REQUEST FOR LEAVE TO AMEND COMPLAINT
CASE NO. 10-CV-1757-LAB-AJB

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Plaintiff Streetspace, Inc. (“Streetspace”) respectfully submits the following response to

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the Court‟s March 3, 2011, Order to Show Cause and this request for leave to amend its original

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complaint. The proposed First Amended Complaint was inadvertently filed without leave on

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February 25, 2011. D.E. No. 30. If the Court grants Streetspace leave to amend its complaint,

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then Streetspace submits that Defendants‟ motion to dismiss or, in the alternative, for a more

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definite statement (D.E. No. 21) should be denied as moot and the hearing on Defendants‟ motion

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to dismiss should be vacated. At a minimum, in light of the pending status of this response and

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request for leave to amend the complaint, Streetspace submits that the hearing on Defendants‟

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motion to dismiss or, in the alternative, for a more definite statement (D.E. No. 21) should be

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continued and not be heard on March 14, 2011.
The proposed First Amended Complaint does not have a material effect on either

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Defendants‟ pending motion to transfer this action to the Northern District of California (D.E. No.

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23), or Streetspace‟s pending motion to disqualify Cooley LLP as counsel for Millennial Media

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(D.E. No. 29). Accordingly, Streetspace submits that the hearings on Defendants‟ pending

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motion to transfer this action to the Northern District of California (D.E. No. 23), and

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Streetspace‟s pending motion to disqualify Cooley LLP as counsel for Millennial Media (D.E.

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No. 29) should proceed on March 14, 2011, as noticed.

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I.

INTRODUCTION

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The Court should grant Streetspace leave to amend its complaint because Rule 15(a) of

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the Federal Rules of Civil Procedure provides that a district court should “freely” grant leave to

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amend when justice so requires. Fed. R. Civ. P. 15(a). This policy is to be applied with “extreme

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liberality.” Three Rivers Provider Network, Inc. v. Meritain Health, Inc., 2008 WL 2872664, at

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*17 (S.D. Cal. July. 23, 2008) (citing Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048,

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1051-52 (9th Cir. 2003)). Defendants cannot overcome the strong presumption in favor of

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granting this motion because this case remains in its very early stages, no discovery has begun, no

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previous request for leave to amend has been made, and no defendant has even answered the

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original complaint yet. Moreover, the proposed First Amended Complaint is 17 pages longer

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than the original complaint, adds considerable detail to many of its allegations, and seeks to
-1STREETSPACE’S RESPOINSE TO OSC AND REQUEST FOR LEAVE TO AMEND COMPLAINT
CASE NO. 10-CV-1757-LAB-AJB

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address the perceived shortcomings of the original complaint raised by Defendants in their motion

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to dismiss. Accordingly, leave to amend should be granted.

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II.

STATEMENT OF FACTS

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Streetspace‟s proposed First Amended Complaint (“FAC”), D.E. No. 30, adds

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considerable detail to many of its allegations, and seeks to address the perceived deficiencies

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raised by Defendants in their motion to dismiss or, in the alternative, for a more definite

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statement. D.E. No. 21.

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For example, in their motion to dismiss, Defendants claim that (1) Streetspace fails to

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state a claim for direct infringement against Millennial Media or Jumptap; (2) Streetspace‟s

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claims for indirect infringement against the Defendants are deficient because (according to

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Defendants) Streetspace fails to identify any direct infringers, fails to state facts sufficient to show

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that any Defendant knew of the „969 patent prior to the filing of the lawsuit, and fails to plead

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facts sufficient to show how any Defendant actively induce infringement; and (3) Streetspace fails

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to state a claim for contributory infringement. D.E. No. 21 at 5-6, 8-9, 11.

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In its proposed First Amended Complaint, Streetspace addresses these perceived

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deficiencies. Specifically, Streetspace alleges that Millennial Media and Jumptap directly

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infringe by “making, using, selling, importing, exporting, and/or offering for sale a system and/or

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method that employs a terminal, a database, and a program as recited in one or more claims of the

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„969 patent.” D.E. No. 30 [FAC, ¶¶ 176, 189]. For example, Streetspace alleges that Millennial

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Media and Jumptap use terminals to test and develop their mobile advertising network. D.E. No.

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30 [FAC, ¶¶ 177-78, 191, 193]. Further, Streetspace alleges in the FAC that all Defendants

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directly infringe by maintaining databases in the United States and abroad that store and retain

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consumer data obtained from consumers located inside and outside the United States. The

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consumer data that Defendants retain in their databases includes, among other things, Internet

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behavior of consumers; locations of consumers and/or consumers‟ terminals; personal

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information such as income and gender; responses to advertising; login and logoff times; IP

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addresses, visited web sites, pages, and apps; unique cookie IDs; browser types; and terminal

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types. Id., ¶¶ 62, 87, 101, 120, 134, 149, 163, 178, 193. Streetspace also alleges in the FAC that
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CASE NO. 10-CV-1757-LAB-AJB

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Millennial Media and Jumptap utilize server software and/or tracking cookies located on

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consumer terminals in order to identify consumers and target advertisements. Id., ¶¶ 179, 194.
It remains to be seen whether any Defendant actually knew of the „969 patent before filing

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of this lawsuit on August 23, 2010, which will be the subject of discovery. Thus, Streetspace

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pleads that Defendants knew of the „969 patent since at least August 23, 2010 (the filing date of

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the original complaint). Id., ¶¶ 72, 90, 109, 123, 138, 152, 167, 181, 196.
As for its indirect infringement allegations, Streetspace identifies the alleged direct

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infringers whom each Defendant induces to infringe, such as (1) consumers receiving targeted

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advertisements from the Defendants, (2) advertisers employing Defendants‟ systems and

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methodologies for delivering and displaying targeted advertisements, and (3) web site or app

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developers utilizing Defendants‟ targeted advertisements. Id., ¶¶ 73, 91, 110, 124, 139, 153, 168,

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182, 197. Further, Streetspace alleges that Defendants induce direct infringement by intentionally

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designing, manufacturing, marketing, promoting, selling, servicing, supporting, providing

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software developer kits and online help, and educating consumers, advertisers, and app

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developers on their software, and systems and methodologies for delivering and displaying

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targeted advertisements. Id. Moreover, Streetspace alleges that Defendants intentionally

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encourage and/or aid consumers, advertisers, and app developers to use terminals, Defendants‟

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databases comprising consumer data, and Defendants‟ specified software (i.e., programs) for the

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display of targeted advertisements. Id. Defendants knew or should have known that these actions

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would cause direct infringement of the „969 patent and did so with specific intent to encourage

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and aid direct infringement. Id.

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III.

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ARGUMENT
Rule 15(a) of the Federal Rules of Civil Procedure provides that a district court should

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“freely” grant leave to amend a complaint “when justice so requires.” Fed. R. Civ. P. 15(a)(2).

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This policy is to be applied with “extreme liberality.” Three Rivers Provider Network, Inc. v.

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Meritain Health, Inc., 2008 WL 2872664, at *17 (S.D. Cal. July. 23, 2008) (citing Eminence

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Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051-52 (9th Cir. 2003)). Absent prejudice or a

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strong showing of any of the other Foman factors, there is a strong presumption in favor of
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CASE NO. 10-CV-1757-LAB-AJB

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granting leave to amend. Id.; see also Foman v. Davis, 371 U.S. 178, 182 (1962) (detailing

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factors to consider in evaluating a motion for leave to amend, including undue delay, bad faith,

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repeated failure to cure deficiencies, and futility).

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In view of the very early procedural posture of this case, and applying the Foman factors,

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leave to amend should be granted. Streetspace has not unduly delayed in seeking leave to amend

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because Defendants filed their motion to dismiss or, in the alternative, for a more definite

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statement alleging perceived deficiencies in Streetspace‟s complaint on January 18, 2011—

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scarcely six weeks ago. D.E. No. 21. No dates have been set, no discovery has commenced, and

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no Defendant has even answered the original complaint yet, so this factor strongly weighs in

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favor of granting leave to amend.
Moreover, Streetspace is not seeking leave to amend in bad faith; to the contrary,

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Streetspace‟s proposed First Amended Complaint seeks to address the alleged deficiencies

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asserted by Defendants in their motion to dismiss. For example, in their motion to dismiss,

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Defendants claim that (1) Streetspace fails to state a claim for direct infringement against

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Millennial Media or Jumptap; (2) Streetspace‟s claims for indirect infringement against the

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Defendants are deficient because (according to Defendants) Streetspace fails to identify any direct

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infringers, fails to state facts sufficient to show that any Defendant knew of the „969 patent prior

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to the filing of the lawsuit, and fails to plead facts sufficient to show how any Defendant actively

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induced infringement; and (3) Streetspace fails to state a claim for contributory infringement.

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D.E. No. 21 at 5-6, 8-9, 11.

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In its proposed First Amended Complaint, Streetspace addresses these perceived

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deficiencies. Specifically, Streetspace alleges that Millennial Media and Jumptap directly

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infringe by “making, using, selling, importing, exporting, and/or offering for sale a system and/or

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method that employs a terminal, a database, and a program as recited in one or more claims of the

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„969 patent.” D.E. No. 30 [FAC, ¶¶ 176, 189]. For example, Streetspace alleges that Millennial

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Media and Jumptap use terminals to test and develop their mobile advertising network. D.E. No.

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30 [FAC, ¶¶ 177-78, 191, 193]. Further, Streetspace alleges in the FAC that all Defendants

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directly infringe by maintaining databases in the United States and abroad that store and retain
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CASE NO. 10-CV-1757-LAB-AJB

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consumer data obtained from consumers located inside and outside the United States. The

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consumer data that Defendants retain in their databases includes, among other things, Internet

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behavior of consumers; locations of consumers and/or consumers‟ terminals; personal

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information such as income and gender; responses to advertising; login and logoff times; IP

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addresses, visited web sites, pages, and apps; unique cookie IDs; browser types; and terminal

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types. Id., ¶¶ 62, 87, 101, 120, 134, 149, 163, 178, 193. Streetspace also alleges in the FAC that

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Millennial Media and Jumptap utilize server software and/or tracking cookies located on

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consumer terminals in order to identify consumers and target advertisements. Id., ¶¶ 179, 194.

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As for its indirect infringement allegations, Streetspace identifies the alleged direct

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infringers whom Defendants induce to infringe, such as (1) consumers receiving targeted

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advertisements from the Defendants, (2) advertisers employing Defendants‟ systems and

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methodologies for delivering and displaying targeted advertisements, and (3) web site or app

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developers utilizing Defendants‟ targeted advertisements. Id., ¶¶ 73, 91, 110, 124, 139, 153, 168,

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182, 197.

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Further, Streetspace alleges that Defendants induce direct infringement by intentionally

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designing, manufacturing, marketing, promoting, selling, servicing, supporting, providing

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software developer kits and online help, and educating consumers, advertisers, and app

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developers on their software, and systems and methodologies for delivering and displaying

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targeted advertisements. Id. Moreover, Streetspace alleges that Defendants intentionally

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encourage and/or aid consumers, advertisers, and app developers to use terminals, Defendants‟

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databases comprising consumer data, and Defendants‟ specified software (i.e., programs) for the

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display of targeted advertisements. Id. Defendants knew or should have known that these actions

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would cause direct infringement of the „969 patent and did so with specific intent to encourage

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and aid direct infringement. Id. Accordingly, this factor strongly favors granting leave to amend.

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Next, Streetspace has not repeatedly failed to cure perceived deficiencies in its complaint;

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rather, this is Streetspace‟s first request for leave to amend the complaint. Finally, it is not futile

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to allow leave to amend, nor would Defendants suffer any prejudice from granting leave to

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amend; to the contrary, Streetspace‟s proposed First Amended Complaint adds considerably more
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CASE NO. 10-CV-1757-LAB-AJB

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detail to many of its allegations, and seeks to address the perceived deficiencies raised by

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Defendants. Indeed, the Defendants all requested extensions of time to respond to the original

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complaint in this matter, so they cannot reasonably claim prejudice from any delay in having to

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respond to the FAC. Therefore, all factors strongly weigh in favor of granting leave to amend.

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IV.

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CONCLUSION
For the foregoing reasons, the Court should not strike the First Amended Complaint (D.E.

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No. 30) and should grant Streetspace‟s request for leave to amend the complaint.

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Dated: March 4, 2011

SAN DIEGO IP LAW GROUP LLP

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By:/s/James V. Fazio, III
DOUGLAS E. OLSON
JAMES V. FAZIO, III
TREVOR Q. CODDINGTON, PH.D.
Attorneys for Plaintiff
STREETSPACE, INC.

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-6STREETSPACE’S RESPONSE TO OSC AND REQUEST FOR LEAVE TO AMEND
CASE NO. 10-CV-1757-LAB-AJB

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CERTIFICATE OF SERVICE
I, the undersigned, certify and declare that I am over the age of 18 years old, employed in
the County of San Diego, State of California, and am not a party to the above-entitled action.
On March 4, 2011, I filed a copy of the following documents:
PLAINTIFF STREETSPACE, INC.’S RESPONSE TO THE COURT’S MARCH 3,
2011 ORDER TO SHOW CAUSE, AND REQUEST FOR LEAVE TO AMEND ITS
COMPLAINT

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by electronically filing with the Clerk of the Court using the CM/ECF system, which will send
notification of such filing to the following email addresses:
John S. Kyle
Cooley LLP
Email: [e-mail]
Frank V. Pietrantonio
Cooley LLP
Email: [e-mail]
Christopher C. Campbell
Cooley LLP
Email: [e-mail]
George A. Riley
O‟Melveny & Myers LLP
Email: [e-mail]
Luann L. Simmons
O‟Melveny & Myers LLP
Email: [e-mail]
Anne E. Huffsmith
O‟Melveny & Myers LLP
Email: [e-mail]
Shawn E. McDonald
Foley & Lardner LLP
Email: [e-mail]

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CASE NO. 10-CV-1757-LAB-AJB

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Matthew B. Lowrie
Foley & Lardner LLP
Email: [e-mail]
Justin E. Gray
Foley & Lardner LLP
Email: [e-mail]
Kurt M. Kjelland
Goodwin Procter LLP
Email: [e-mail]
David Heskel Ben-Meir
Alston & Bird LLP
[e-mail]

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I hereby certify and declare, under the penalty of perjury, under the laws of the United

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States and of the State of California, that the foregoing is true and correct.

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Executed on this 4th day of March 2011, at San Diego, California.

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By: /s/ James V. Fazio, III
JAMES V. FAZIO, III

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CASE NO. 10-CV-1757-LAB-AJB