American GNC Corporation v. LG Electronics Inc. et al

Filing 52

ORDER granting in part and denying in part Plaintiff's 25 Motion to Strike Affirmative Defenses. Court denies Plaintiff's request to strike Defendants' second and third affirmative defenses and grants the request to strike Defendants' seventh affirmative defenses. Court strikes Defendants' seventh affirmative defense without prejudice. Signed by Judge Cynthia Bashant on 10/24/2017. (jah)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 AMERICAN GNC CORPORATION, Case No. 17-cv-01090-BAS-BLM Plaintiff, 12 13 ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF’S MOTION TO STRIKE AFFIRMATIVE DEFENSES v. 14 15 LG ELECTRONICS INC., et al., Defendants. 16 [ECF No. 25] 17 18 Plaintiff American GNC Corporation filed a First Amended Complaint (“FAC”) 19 against Defendants LG Electronics Inc.; LG Electronics MobileComm U.S.A., Inc.; and 20 LG Electronics Mobile Research U.S.A., LLC alleging sixteen counts of patent 21 infringement. (ECF No. 6.) Defendants’ Answer raises seven affirmative defenses. (ECF 22 No. 12.) Plaintiff now moves to strike three of Defendants’ affirmative defenses. (ECF No. 23 25.) In response, Defendants maintain their second and third defenses and withdraw the 24 seventh. (ECF No. 28.) Plaintiff replies. (ECF No. 30.) 25 The Court finds this motion suitable for determination on the papers submitted and 26 without oral argument. See Fed. R. Civ. P. 78(b); Civ. L.R. 7.1(d)(1). For the following 27 reasons, the Court GRANTS IN PART and DENIES IN PART Plaintiff’s motion to 28 strike. –1– 17cv1090 1 I. BACKGROUND 2 Plaintiff “specializes in inventing and applying advanced and innovative 3 technologies to contemporary problems within the fields of Guidance, Navigation, Control 4 and Communications (GNCC), Inertial Sensors, Health Monitoring, Intelligent Processing, 5 and Autonomous Robotics.” (FAC ¶ 19.) Plaintiff owns U.S. Patent Numbers 6,311,555; 6 6,415,227; 6,508,122; 6,516,283; 6,671,648; 6,697,758; and 6,792,353 (the “Patents-in- 7 Suit”). (Id. ¶ 28.) 8 In its FAC, Plaintiff alleges Defendants infringe the Patents-in-Suit by “making, 9 using, offering for sale, selling and/or importing” an assortment of “accused smartphones, 10 tablets, and other mobile wireless devices.” (FAC ¶¶ 38-39.) Defendants assert seven 11 affirmative defenses in their Answer (ECF No. 12), and Plaintiff now moves to strike three 12 of these defenses (ECF No. 25). 13 14 II. LEGAL STANDARD 15 Rule 12(f) of the Federal Rules of Civil Procedure provides that a court may strike 16 from a pleading “an insufficient defense or any redundant, immaterial, impertinent, or 17 scandalous matter.” “[T]he function of a 12(f) motion to strike is to avoid the expenditure 18 of time and money that must arise from litigating spurious issues by dispensing with those 19 issues prior to trial.” Sidney-Vinstein v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983). 20 “Motions to strike are generally regarded with disfavor because of the limited 21 importance of pleading in federal practice, and because they are often used as a delaying 22 tactic.” Neilson v. Union Bank of Cal., 290 F. Supp. 2d 1101, 1152 (C.D. Cal. 2003). “[The] 23 motion . . . should not be granted unless the matter to be stricken clearly could have no 24 possible bearing on the subject of the litigation. If there is any doubt . . . the court should 25 deny the motion.” Platte Anchor Bolt, Inc. v. IHI, Inc., 352 F. Supp. 2d 1048, 1057 (N.D. 26 Cal. 2004) (citations omitted). Before a motion to strike affirmative defenses may be 27 granted, “the Court must be convinced that there are no questions of fact, that any questions 28 of law are clear and not in dispute, and that under no set of circumstances could the defenses –2– 17cv1090 1 succeed.” Levin–Richmond Terminal Corp. v. Int’l Longshoremen’s & Warehousemen’s 2 Union, Local 10, 751 F. Supp. 1373, 1375 (N.D. Cal. 1990) (quoting Sys. Corp. v. Am. Tel. 3 & Tel. Co., 60 F.R.D. 692, 694 (S.D.N.Y. 1973)). The court “must view the pleadings in a 4 light most favorable to the pleading party.” In re, Inc. Sec. Litig., 114 F. 5 Supp. 2d 955, 965 (C.D. Cal. 2000). 6 An affirmative defense is sufficient under Rule 12(f) if “it gives plaintiff fair notice 7 of the defense.” Wyshak v. City Nat’l Bank, 607 F.2d 824, 827 (9th Cir. 1979); see also 8 Vogel v. Linden Optometry APC, No. CV 13-00295 GAF (SHx), 2013 WL 1831686, at *3 9 (C.D. Cal. Apr. 30, 2013) (stating that the Ninth Circuit has continued to apply Wyshak 10 post Iqbal/Twombly and citing Simmons v. Navajo Cty., 609 F.3d 1011, 1023 (9th Cir. 11 2010)). Under Wyshak, “[f]air notice generally requires that the defendant state the nature 12 and grounds for the affirmative defense.” Kohler v. Island Rests., LP, 280 F.R.D. 560, 564 13 (S.D. Cal. 2012). “It does not, however, require a detailed statement of facts.” Id. 14 15 III. ANALYSIS 16 A. 17 Initially, the parties disagree on the pleading standard applicable to affirmative 18 defenses. Plaintiff argues for the Twombly/Iqbal plausibility pleading standard. (Mot. 1:4- 19 12, ECF No. 25; Reply 5:28-7:10, ECF No. 30.) See also Bell Atl. Corp. v. Twombly, 550 20 U.S. 544, 554-57 (2007); Ashcroft v. Iqbal, 556 U.S. 662, 677-79 (2009). Defendants argue 21 for the Wyshak fair notice pleading standard. (Opp’n 3:16-26, ECF No. 28.) Challenge to Legal Standard 22 Recent decisions acknowledge that the Ninth Circuit district courts are split on this 23 issue. See, e.g., Rahman v. San Diego Account Serv., No. 16-cv-2061-JLS (KSC), 2017 24 WL 1387206, at *2 (S.D. Cal. Apr. 18, 2017); MyGo, LLC v. Mission Beach Indus., LLC, 25 No. 3:16-cv-2350-GPC-RBB, 2017 WL 107346, at *7 (S.D. Cal. Jan. 11, 2017); Rosen v. 26 Masterpiece Mktg. Grp., LLC, 222 F. Supp. 3d 793, 802 (C.D. Cal. 2016). 27 This Court sides with the courts continuing to apply the Wyshak fair notice pleading 28 standard to affirmative defenses for four reasons. First, the Twombly/Iqbal plausibility –3– 17cv1090 1 standard is “grounded in Federal Rule of Civil Procedure 8(a)(2), which governs claims, 2 rather than Federal Rule of Civil Procedure 8(c), which governs affirmative defenses.” DK 3 Holdings v. Miva, Inc., No. 16-cv-0580 W (RBB), 2016 WL 4943048, at *4 (S.D. Cal. 4 Sept. 16, 2016). While a pleader must “show” entitlement to relief in a claim, a pleader 5 must only “affirmatively state” an affirmative defense. See Vogel, 2013 WL 1831686, at 6 *3 (continuing to apply the fair notice standard and noting “important linguistic 7 differences” between Rule 8(a)(2) and Rule 8(c)). 8 Second, fairness considerations weigh in favor of a lower pleading standard for 9 affirmative defenses because an answer must be crafted under stricter time constraints than 10 a complaint. See Vogel, 2013 WL 1831686, at *3; see also Tyco Fire Prods. v. Victaulic 11 Co., 777 F. Supp. 2d 893, 901 (E.D. Pa. 2011) (“[A]pplying the concept of notice to require 12 more than awareness of the issue’s existence imposes an unreasonable burden on 13 defendants who risk the prospect of waiving a defense at trial by failing to plead it . . . and 14 have a short amount of time to develop the facts necessary to do so . . . .”); Fed. R. Civ. P. 15 12(b) (“Every defense to a claim for relief in any pleading must be asserted in the 16 responsive pleading if one is required.”). 17 Third, “a heightened pleading requirement would produce more motions to strike, 18 which are disfavored.” Bayer CropScience AG v. Dow AgroSciences LLC, No. 10-1045, 19 2011 WL 6934557, at *2 (D. Del. Dec. 30, 2011) (citation omitted). 20 Finally, the Ninth Circuit has not instructed district courts to apply the 21 Twombly/Iqbal standard to affirmative defenses. For these four reasons, the Court confirms 22 its previous decisions on this issue and continues to apply the Wyshak pleading standard to 23 affirmative defenses. 24 25 B. 26 Plaintiff requests the Court strike the second, third, and seventh affirmative defenses 27 Application from Defendants’ Answer. 28 –4– 17cv1090 1 1. Second Affirmative Defense 2 Defendants contend that they have not and do not infringe “any valid and enforceable 3 claim of the Patents-in-Suit, either directly or indirectly, in particular because not every 4 accused instrumentality practices every claimed limitation.” (Answer ¶ 611, ECF No. 12.) 5 Plaintiff seeks to strike this defense because Defendants have not “pled any facts or 6 arguments in support of [their] non-infringement defense, and [Plaintiff] remains unaware 7 of any basis for non-infringement.” (Reply 1:9-10 (emphasis in original).) Defendants 8 argue that their denial of the infringement assertions constitutes fair notice of their non- 9 infringement defense and that factual plausibility is not required. (Opp’n 6:27-7:1.) For the 10 reasons outlined above, the Court rejects Plaintiff’s arguments challenging this defense on 11 the basis of Twombly/Iqbal plausibility and turns to whether the defense suffices under the 12 fair notice pleading standard. 13 At this point, the non-infringement contentions provide sufficient notice to Plaintiff 14 that Defendants will pursue this affirmative defense. Plaintiff’s motion to strike this 15 defense is premature. Plaintiff will have the opportunity to obtain facts about this defense 16 during the discovery process. See Vistan Corp. v. Fadei USA, Inc., No. C-10-4862 JCS, 17 2011 WL 1544796, at *7 (N.D. Cal. Apr. 25, 2011) (“These affirmative defenses, while 18 boilerplate, are standard affirmative defenses, appropriate at the outset of the case before 19 discovery has commenced.”). Further, the non-infringement contentions bear directly on 20 Plaintiff’s infringement claims, and a motion to strike “should not be granted unless the 21 matter to be stricken clearly could have no possible bearing on the subject of the litigation.” 22 See Platte Anchor Bolt, Inc., 352 F. Supp. 2d at 1057. 23 24 Accordingly, the Court denies Plaintiff’s motion to strike Defendants’ second affirmative defense. 25 26 2. Third Affirmative Defense 27 Plaintiff launches a similar attack on Defendants’ third affirmative defense. In this 28 defense, Defendants assert invalidity of one or more claims of the Patents-in-Suit, –5– 17cv1090 1 specifically referencing: (i) several federal statutes and regulations, and (ii) navigational 2 practices appearing in a military textbook that Defendants argue predated the claims in 3 U.S. Patent Numbers 6,415,227 (the “227 patent”) and 6,792,353 (the “353 patent”). 4 (Answer ¶ 612.) Plaintiff first argues that the specific references to the 227 and 353 patents 5 lack sufficient detail to be plausible and that Defendants provide no factual basis for the 6 invalidity defense for the other five Patents-in-Suit. (Mot. Ex. A, Mem. of P. & A. 5:2-10, 7 ECF No. 25-1.) Plaintiff later contends that this defense also fails under the Wyshak 8 pleading standard. (Reply 2:2-12.) Defendants respond that their references to specific 9 statutes provide fair notice that the patentability and “validity of claims will be challenged 10 as anticipated, obvious, indefinite, or unsupported.” (Opp’n 8:14-19.) 11 Applying the Wyshak standard for the reasons discussed above, the Court finds that 12 Defendants’ invalidity defense provides sufficient notice to Plaintiff at this time. As with 13 Defendants’ non-infringement defense, Plaintiff will have the opportunity to obtain facts 14 about the invalidity contentions during the discovery process. See Vistan Corp., 2011 WL 15 1544796, at *7. Further, Defendants’ references to specific statutes “state the nature and 16 grounds” for their defense, and Defendants are not required to include “a detailed statement 17 of facts.” See Kohler, 280 F.R.D. at 564. Additionally, Defendants’ invalidity contentions 18 bear directly on Plaintiff’s infringement claims, and a motion to strike “should not be 19 granted unless the matter to be stricken clearly could have no possible bearing on the 20 subject of the litigation.” See Platte Anchor Bolt, Inc., 352 F. Supp. 2d at 1057. 21 22 Accordingly, the Court denies Plaintiff’s motion to strike Defendants’ third affirmative defense. 23 24 3. Seventh Affirmative Defense 25 Defendants assert that Plaintiff’s claims “are barred, in whole or in part, by 35 U.S.C. 26 § 288.” (Answer ¶ 616.) Plaintiff argues that this affirmative defense fails to provide fair 27 notice and lacks a factual or legal basis. (Mot. 1:6-7.) In response, Defendants withdraw 28 –6– 17cv1090 1 this defense. (Opp’n 1:25.) Therefore, the Court grants Plaintiff’s motion to strike the 2 seventh affirmative defense. 3 4 IV. CONCLUSION 5 In light of the foregoing, the Court GRANTS IN PART and DENIES IN PART 6 Plaintiff’s motion to strike (ECF No. 25). Specifically, the Court DENIES Plaintiff’s 7 request to strike Defendants’ second and third affirmative defenses and GRANTS 8 Plaintiff’s request to strike Defendants’ seventh affirmative defense. The Court strikes 9 Defendants’ seventh affirmative defense without prejudice. 10 IT IS SO ORDERED. 11 12 DATED: October 24, 2017 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 –7– 17cv1090

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