XYZ Corporation v. The Individuals, Partnerships and Unincorporated Associations Identified on Schedule A
Filing
77
Order on Defendants Motion to Dismiss: granting in part 43 Motion to Dismiss. Signed by Senior Judge Robert N. Scola, Jr on 2/7/2024. See attached document for full details. (pc)
United States District Court
for the
Southern District of Florida
Shenzhen Hengzechen
Technology Co., Ltd., Plaintiff,
v.
The Individuals, Partnerships,
and Unincorporated Associations
identified on Schedule “A”,
Defendants.
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Civil Action No. 23-23380-Civ-Scola
Order on Defendants’ Motion to Dismiss
This cause comes before the Court on the motion to dismiss (Mot., ECF
No. 43) by Defendants Zhuhai Saide Cross-border E-Commerce Co., Ltd.
(Defendant No. 4, SDPEIA Store on Schedule A), Shenzhen Zeyou Zhicheng
Technology Co., Ltd. (Defendant No. 12, Zeeyoocc on Schedule A), Shenzhen
Magnus Technology Co., Ltd. (Defendant No. 2, WOHBAY on Schedule A), and
Shanghai Yi’an New Materials Co., Ltd. (Defendant No. 13, SHYAXCL on
Schedule A) (collectively, the “Moving Defendants”). The Plaintiff has responded
opposing the motion. (Response, ECF No. 52.) The Moving Defendants have not
replied, and the time to do so has passed. Having reviewed the record, the parties’
briefs, and the relevant legal authorities, the Court grants in part the motion to
dismiss. (Mot., ECF No. 43.)
1. Background 1
On September 27, 2023, the Plaintiff Shenzhen Hengzechen Technology
Co., Ltd. (“Shenzhen”) filed the operative amended complaint, bringing one
count of patent infringement under 35 U.S.C. § 271 against the Individuals,
Partnerships, and Unincorporated Associations identified on Schedule “A”
(collectively, the “Defendants”). The amended complaint alleges that the
Defendants, through e-commerce stores, are “manufacturing, importing,
promoting, reproducing, offering for sale, selling, and/or distributing goods
that incorporate and infringe Plaintiff’s patent” in violation of federal patent
law. (Am. Compl. ¶ 3, ECF No. 8.) Shenzhen owns United States Utility Patent,
1 This background is based on the allegations in the Plaintiff’s amended complaint. For the
purposes of evaluating the Defendants’ motion, the Court accepts the Plaintiff’s factual
allegations as true and construes the allegations in the light most favorable to the Plaintiff per
Federal Rule of Civil Procedure 12(b)(6).
No. US 11,559,140 (hereinafter, the “140 Patent”), for a waterproof pad and
waterproof structure for a cabinet under a sink with a drainage hole feature
(“Under Sink Mat”). The 140 Patent has been registered with the United States
Patent and Trademark Office (“USPTO”) and, as such, is protected from
infringement under federal patent law. (See Ex. 1 to Pl.’s Am. Compl., ECF No.
8-1.) Shenzhen demonstrated it is the owner of the 140 Patent by submitting
copies of the U.S. Utility Patent No. US 11,559,140, which is dated January 24,
2023. (See id.; see also Pl.’s Decl. ¶ 5, ECF No. 10.)
The Plaintiff initially brought the complaint against eighty (80)
Defendants. (See Schedule A to the Am. Compl., ECF No. 8-2.) Of those, only
four Defendants filed the motion to dismiss at issue. The Moving Defendants
raise two grounds for dismissal: (1) the amended complaint fails to plead
compliance with the marking or notice requirement in 35 U.S.C. § 287, and (2)
Plaintiff cannot recover damages for infringement of a design patent because
the 140 Patent is a utility patent. (Mot., ECF No. 43.)
The Court holds that because the amended complaint contains no
allegations that the Plaintiff marked the patented items or provided the
Defendants with the required notice, the Court dismisses Plaintiff’s claim for
damages prior to the unsealing of the amended complaint on November 6,
2023, without prejudice. Further, because Plaintiff has not brought a claim
for infringement of a design patent, the Court dismisses Plaintiff’s claim for
damages under 35 U.S.C. § 289 without prejudice. Although only the four
Moving Defendants filed the motion to dismiss, the Court dismisses the
claims as indicated above for all Defendants identified on Schedule “A”
based on the deficiencies in the amended complaint.
2. Legal Standard
A court considering a motion to dismiss, filed under Federal Rule of Civil
Procedure 12(b)(6), must accept all of the complaint’s allegations as true,
construing them in the light most favorable to the plaintiff. Pielage v.
McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). Although a pleading need
only contain a short and plain statement of the claim showing that the pleader
is entitled to relief, a plaintiff must nevertheless articulate “enough facts to
state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007). “But where the well-pleaded facts do not permit the
court to infer more than the mere possibility of misconduct, the complaint has
alleged—but it has not shown—that the pleader is entitled to relief.” Ashcroft v.
Iqbal, 556 U.S. 662, 679 (2009) (quoting Fed. R. Civ. P. 8(a)(2)) (internal
punctuation omitted). A court must dismiss a plaintiff’s claims if she fails to
nudge her “claims across the line from conceivable to plausible.” Twombly, 550
U.S. at 570.
3. Analysis
A. The Plaintiff has not alleged marking or notice as required by 35
U.S.C. § 287.
The present motion to dismiss relies on 35 U.S.C. § 287(a), which bars
patentees from recovering damages if they did not mark their patented items or
otherwise notify infringers of the alleged infringement. The Moving Defendants
argue the amended complaint fails to provide any more than conclusory
allegations regarding notice of the patent for the Under Sink Mat. The Plaintiff’s
response alleged that the filing of the lawsuit constitutes such notice and the
Defendants continued to sell copies of the infringing item thereafter. The Court
agrees with the Moving Defendants that Plaintiff has failed to properly plead
marking or notice as required under the statute. However, the Court agrees
with the Plaintiff that the filing of a lawsuit constitutes actual notice. See Arctic
Cat Inc. v. Bombardier Recreational Prod. Inc., 950 F.3d 860, 864 (Fed. Cir.
2020).
To recover damages for patent infringement, patentees must mark their
patented items or notify infringers of their patent. 35 U.S.C. § 287(a) (“In the
event of failure so to mark, no damages shall be recovered by the patentee in
any action for infringement, except on proof that the infringer was notified of
the infringement and continued to infringe thereafter[.]”.) Even though a
Plaintiff “need not prove its case at the pleading stage,” Bot M8 LLC v. Sony
Corp. of Am., 4 F.4th 1342, 1346 (Fed. Cir. 2021), Plaintiffs do have the
affirmative obligation to plead compliance with the notice requirements of the
marking statute. Arctic Cat Inc. v. Bombardier Recreational Prod. Inc., 876 F.3d
1350, 1365-66 (Fed. Cir. 2017) (citing Dunlap v. Schofield, 152 U.S. 244, 248
(1894)). The duty falls on Plaintiffs because whether patented items have been
marked is “a matter peculiarly within [the patentee’s] own knowledge.” Id.
Further, an infringer’s knowledge alone is insufficient; the statute requires the
patentee to affirmatively mark the patent or provide notice to the infringer.
Arctic Cat, 950 F.3d at 866-67. The notice must include both the patentee’s
identity and the infringement. Lans v. Digital Equip. Corp., 252 F.3d 1320, 1327
(Fed. Cir. 2001)
The amended complaint is silent as to the Plaintiff’s marking of the patent,
(see generally Am. Compl., ECF No. 8), so the Court turns to whether the
Plaintiff alleged that it provided notice to the Defendants. The amended
complaint states: (1) “Upon information and belief, Defendants willfully and
knowingly infringe Plaintiff’s Patent rights.” (Am. Compl. ¶ 22); (2) “At all times
relevant hereto, Defendants knew or should have known of Plaintiff’s
ownership of the Patent[.]” (Am. Compl. ¶ 26); and (3) “Defendants are engaging
in the above-described illegal infringing activities knowingly and intentionally
or with reckless disregard or willful blindness to Plaintiff’s rights.” (Am.
Compl. ¶ 28) (emphasis added). The allegations speak only to the Defendant’s
purported knowledge and fail to allege that the Plaintiff affirmatively marked
the patented items or provided notice to Defendants about the infringement
prior to the filing of the lawsuit. Even if Defendant’s knowledge alone was
sufficient to satisfy the notice requirement, the conclusory allegations
reproduced above would “not permit the court to infer more than the mere
possibility of misconduct” and are therefore insufficient to survive a motion to
dismiss. See Iqbal, 556 U.S. at 679.
However, the Plaintiff’s response to the motion to dismiss correctly notes
that “filing of an action for infringement shall constitute [required] notice” to
Defendants. 35 U.S.C. § 287(a); see Arctic Cat, 950 F.3d at 864. In the event of
a lack of pre-suit notice, a Plaintiff can only recover damages for infringement
that occurs following the filing of the lawsuit. Arctic Cat, 950 F.3d at 866-67.
Here, because the lawsuit was filed under seal until November 6, 2023, the
Court dismisses Plaintiff’s claim for damages prior to the unsealing of the
lawsuit on November 6, 2023.
B. Plaintiff has not brought a claim for infringement of a design patent.
In its response to the motion to dismiss, the Plaintiff acknowledged that the
references in the amended complaint to 35 U.S.C. § 289—the statute governing
remedies for design patent infringement—are “a typographical error.” (ECF No.
52 at 5.) Accordingly, the Court dismisses Plaintiff’s claim for damages under
35 U.S.C. § 289 because the Plaintiff has not stated a claim for design patent
infringement.
4. Conclusion
For the reasons set forth above, the Court grants in part the motion to
dismiss. (Mot., ECF No. 43.) Plaintiff’s claims for damages prior to November 6,
2023, are dismissed without prejudice as to all Defendants. Additionally,
Plaintiff’s claims for damages under 35 U.S.C. § 289 are dismissed without
prejudice as to all Defendants.
Done and ordered in Miami, Florida on February 7, 2024.
________________________________
Robert N. Scola, Jr.
United States District Judge
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