Bluestone Innovations LLC v. Bulbrite Industries, Inc.

Filing 32

ORDER by Judge Hamilton granting 24 Motion to Dismiss; finding as moot 30 Stipulation to continue hearing. (pjhlc1, COURT STAFF) (Filed on 4/15/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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BLUESTONE INNOVATIONS LLC,

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Plaintiff,
v.

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ORDER GRANTING MOTION TO
DISMISS

BULBRITE INDUSTRIES, INC.,
Defendant.

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United States District Court
Northern District of California

Case No. 15-cv-5478-PJH

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Before the court is the motion of defendant Bulbrite Industries, Inc. (“Bulbrite”) to

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dismiss the complaint in the above-entitled action. Having read the parties’ papers and

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carefully considered their arguments and the relevant legal authority, the court hereby

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GRANTS the motion.
BACKGROUND

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This is one of 13 cases filed by plaintiff Bluestone Innovations LLC (“Bluestone”)

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alleging infringement of U.S. Patent No. 6,163,557 ('557 Patent), which is directed at the

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fabrication of Group III-V nitride semiconductor films for use in visible LED optoelectronic

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devices. The patent was issued December 19, 2000, and at the time it was assigned to

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Xerox Corporation. In the complaint, Bluestone alleges that it is "the owner by

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assignment" of the '557 patent. The complaint asserts a single cause of action against

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Bulbrite for patent infringement.
Bluestone asserts that Bulbrite has infringed "at least" Claim 1 of the '557 patent

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by,
among other things, directly or through intermediaries, making, using,

importing, providing, supplying, distributing, selling, and/or offering for sale
LED Lightbulbs with epitaxial film (including, without limitation, at least the
Bulbrite LED11A19 Dimmable Warm Light Bulb) which include; a substrate
including at least one upstanding mesa, each mesa having a top surface;
and a group III-V nitride epitaxial film on the top surface of at least one
mesa; wherein the at least one mesa including surfaces oriented along
crack planes of the epitaxial film, covered by one or more claims of the ’557
Patent to the injury of [p]laintiff.

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Cplt ¶ 9. Bluestone also asserts that Bulbrite is "directly infringing, literally infringing,

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and/or infringing the ’557 Patent under the doctrine of equivalents" and that Bulbrite is

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"thus liable for infringement of the ’557 Patent pursuant to 35 U.S.C. § 271." Cplt ¶ 9.

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Bluestone seeks compensatory damages and injunctive relief.
Bulbrite now seeks an order dismissing the complaint for failure to state a claim,

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pursuant to Federal Rule of Civil Procedure 12(b)(6), or in the alternative, an order

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United States District Court
Northern District of California

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requiring Bluestone to file a more definite statement.

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DISCUSSION

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A.

Legal Standard
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests for the

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legal sufficiency of the claims alleged in the complaint. Ileto v. Glock, Inc., 349 F.3d

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1191, 1199-1200 (9th Cir. 2003). Review is generally limited to the contents of the

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complaint, although the court can also consider a document on which the complaint relies

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if the document is central to the claims asserted in the complaint, and no party questions

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the authenticity of the document. See Sanders v. Brown, 504 F.3d 903, 910 (9th Cir.

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2007).

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To survive a motion to dismiss for failure to state a claim, a complaint generally

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must satisfy only the minimal notice pleading requirements of Federal Rule of Civil

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Procedure 8, which requires that a complaint include a “short and plain statement of the

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claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2)

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A complaint may be dismissed under Rule 12(b)(6) for failure to state a claim if the

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plaintiff fails to state a cognizable legal theory, or has not alleged sufficient facts to

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support a cognizable legal theory. Somers v. Apple, Inc., 729 F.3d 953, 959 (9th Cir.

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2013). While the court is to accept as true all the factual allegations in the complaint,
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legally conclusory statements, not supported by actual factual allegations, need not be

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accepted. Ashcroft v. Iqbal, 556 U.S. 662, 678–79 (2009); see also In re Gilead Scis.

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Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008).
The allegations in the complaint "must be enough to raise a right to relief above

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the speculative level[,]" and a motion to dismiss should be granted if the complaint does

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not proffer enough facts to state a claim for relief that is plausible on its face. Bell Atlantic

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Corp. v. Twombly, 550 U.S. 544, 555, 558-59 (2007) (citations and quotations omitted).

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A claim has facial plausibility when the plaintiff pleads factual content that allows the

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court to draw the reasonable inference that the defendant is liable for the misconduct
alleged." Iqbal, 556 U.S. at 678 (citation omitted). "[W]here the well-pleaded facts do not

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United States District Court
Northern District of California

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permit the court to infer more than the mere possibility of misconduct, the complaint has

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alleged – but it has not ‘show[n]' – ‘that the pleader is entitled to relief.'" Id. at 679.

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Where dismissal is warranted, it is generally without prejudice, unless it is clear the

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complaint cannot be saved by any amendment. Sparling v. Daou, 411 F.3d 1006, 1013

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(9th Cir. 2005).

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B.

Bulbrite's Motion

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Bulbrite argues that the allegations in the complaint are inadequate to put it on

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notice as to the nature of the alleged infringement. Bulbrite asserts that the complaint

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should be dismissed because the allegations are insufficient under Twombly/Iqbal, or in

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the alternative, that Bluestone should be required to provide a more definite statement

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pursuant to Federal Rule of Civil Procedure 12(e).

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Bulbrite asserts that the complaint pleads no facts sufficient to show whether or

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how Bulbrite has engaged in "directly infringing, literally infringing, and/or infringing under

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the doctrine of equivalents." Bulbrite asserts that the complaint makes a "bare-bones

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assertion" that Bulbrite is liable for infringement, but pleads no specific facts showing

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"how the patent has been infringed or under which of the many subsections of a statute

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the claim lies" (referring to Cplt ¶ 9). Bulbrite also contends that there are no facts pled

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that are sufficient to state a claim for induced or contributory infringement, apart from the
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conclusory assertion that Bulbrite acted "directly or through intermediaries."
In opposition, Bluestone asserts that until the abrogation of the forms attached as

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an appendix to Rule 84 effective December 1, 2015, the allegations in the complaint

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properly complied with Form 18, and, Bluestone asserts, the Federal Circuit has

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confirmed that the bare-bones allegations in Form 18 are all that are required to state a

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claim for patent infringement.

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In In re Bill of Lading Transmission & Processing Sys. Patent Lit., 681 F.3d 1323,

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1334-35 (Fed. Cir. 2012), the Federal Circuit held that Form 18 is sufficient to state a

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claim for patent infringement, and that to the extent that there is a conflict between
Twombly and the Forms with regard to pleading requirements, “the Forms control"); and

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United States District Court
Northern District of California

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that Form 18 and the Federal Rules of Civil Procedure “do not require a plaintiff to plead

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facts establishing that each element of an asserted claim is met . . . Indeed, a plaintiff

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need not even identify which claims it asserts are being infringed."

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Former Form 18 (applicable at the time the complaint in the present action was

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filed) required "(1) an allegation of jurisdiction; (2) a statement that the plaintiff owns the

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patent; (3) a statement that the defendant has been infringing the patent 'by making,

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selling, and using [the device] embodying' the patent; (4) a statement that the plaintiff has

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given the defendant notice of its infringement; and (5) a demand for an injunction and

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damages." McZeal v. Sprint Nextel Corp., 501 F.3d 1354, 1357 (Fed. Cir. 2007),

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Bluestone argues that the complaint includes all the allegations required by Form 18

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(citing Cplt ¶¶ 3, 5, 6, 9, 10, 11).

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Bluestone asserts that the complaint also meets the requirements of Rule 8 and

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Twombly/Iqbal, as it provides a brief description of what the patent does, and an

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allegation that certain specifically identified products also do what the patent does (citing

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Bender v. L.G. Elecs. U.S.A. Inc., 2010 WL 889421 at *3-4 (N.D. Cal. March 11, 2010)

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(setting forth description of factual allegations that are sufficient to state "a plausible claim

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for relief" in patent infringement claim).

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Bluestone contends that the complaint clearly accuses Bulbrite of direct
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infringement, as it alleges that Bulbrite has "directly" infringed the patent, and is thus

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"liable for infringement of the '557 Patent pursuant to 35 U.S.C. § 271." Bluestone

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argues that the use of the word "directly" in the complaint makes it clear that Bulbrite is

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being accused of direct infringement.

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In reply, Bulbrite argues that the complaint should be dismissed because it fails to

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plead enough facts to state a claim that is plausible on its face. For example, Bulbrite

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contends that the complaint recites language from Claim 1 of the '557 patent, but alleges

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no facts showing how Bulbrite's product or conduct relates to Claim 1 (asserting that the

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allegations are "conclusory"); that the complaint simply announces infringement, but
includes no supporting facts, which results in a claim that is not "plausible" in Bulbrite's

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United States District Court
Northern District of California

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view; that apart from the above, the complaint does not meet all the requirements of

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Form 18, because it does not include "a statement that the plaintiff has given the

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defendant notice of its infringement" as specified by McZeal; and most importantly, that

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the complaint does not clearly identify plaintiff's theory of infringement – that is, is it only

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direct infringement, or does it also include induced or contributory infringement.

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The motion is GRANTED. At the time that Bluestone filed the complaint, Form 18

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was still operative and controlling. With regard to the allegations of direct infringement,

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the complaint includes all the allegations required by Form 18, with the possible

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exception of the “giving notice” requirement. Bluestone contends that it gave notice by

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alleging in the complaint that Bulbrite had infringed its patent. However, if giving notice

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by filing the complaint were adequate, the inclusion of that requirement in a list of what is

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necessary to state a claim in the complaint would be nonsensical.

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If, on the other hand, what is meant is that the complaint must "give notice" of what

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products or combinations of products are accused of infringement, then the court finds

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that the allegations are sufficient, as they clearly provide Bulbrite with notice that

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Bluestone is asserting that Bulbrite has been making and offering for sale "LED lightbulbs

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with epitaxial film (including . . . at least the G7 power Sutcliffe 10W A19 Light Bulb)

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which include the elements claimed in Claim 1 of the '557 patent.
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However, Form 18 applies only to claims for direct infringement. See In re Bill of

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Lading, 681 F.3d at 1336. While the complaint in this case does allege direct

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infringement, at least in the disjunctive, it also includes language that could be interpreted

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as an assertion of induced infringement or contributory infringement ("or [infringement]

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through intermediaries; reference to "supplying," "providing," or "distributing" the accused

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products). In addition, while Bluestone argues in its opposition that the complaint alleges

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a violation of 35 U.S.C. § 271(a) (direct infringement), the complaint in fact alleges a

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violation of § 271 without specifying any subparts. It is true that § 271(a) uses the words

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"makes, uses, offers to sell, or sells" and "imports," but Bluestone has also added
"supplying" from subsection (f) and "providing" and "distributing" which appear nowhere

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United States District Court
Northern District of California

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in § 271.

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Bluestone needs to specify whether this is a claim solely for direct infringement,

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and if so, should use only the statutory terms, or it should clarify whether it also intends a

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claim for indirect or contributory infringement. If it does intend to assert a claim for

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indirect and/or contributory infringement, it must support each such claim with additional

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factual allegations beyond those required by Form 18, sufficient to state a claim in

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accordance with Twombly/Iqbal. See Robert Bosch Healthcare Sys., Inc. v. Express MD

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Solutions LLC, 2012 WL 2803617 at *4 (N.D. Cal. July 10, 2012).
CONCLUSION

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In accordance with the foregoing, the court hereby GRANTS defendant’s motion.

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The dismissal is WITH LEAVE TO AMEND. Any amended complaint shall be filed no

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later than May 6, 2016.

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The hearing on the motion, previously set for April 20, 2016, is VACATED.

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IT IS SO ORDERED.

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Dated: April 15, 2016

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__________________________________
PHYLLIS J. HAMILTON
United States District Judge
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