Groupon, Inc. v. MobGob, LLC

Filing 41

REPLY by Groupon, Inc. to response in opposition to motion 36 , MOTION by Plaintiff Groupon, Inc. to strike answer to complaint, counterclaim 24 28 (Zeller, Steven)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
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GROUPON INC.,
PLAINTIFF,
v.
MOBGOB LLC.,
DEFENDANT.

Civil Action No. 10-CV-07456
Hon. William J. Hibbler

PLAINTIFF’S REPLY TO MOBGOB, LLC’S OPPOSITION TO PLAINTIFF’S
MOTION TO STRIKE DEFENDANT’S AFFIRMATIVE DEFENSES
I.

INTRODUCTION
In its response, Defendant MobGob LLC (“MobGob”) concedes that its First

and Eighth Affirmative Defenses are deficient and indicates its agreement to
dismiss those defenses. For its Second and Fifth Affirmative Defenses, however,
MobGob attempts to mask the obvious deficiencies therein by ignoring binding
precedent from the Seventh Circuit requiring affirmative defenses to contain a
“short and plain statement” of facts. Those defenses contain no citation of fact at all,
rendering both of them incapable of satisfying the requirements of Rule 8 of the
Federal Rules of Civil Procedure. Accordingly, those defenses should also be
stricken by the Court.

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II.

ARGUMENT
A.

MobGob’s Invalidity Affirmative Defense is Glaringly Deficient

MobGob does not dispute, and in fact completely ignores, that in this Circuit,
affirmative defenses are subject to “all pleading requirements of the Federal Rules
of Civil Procedure.” Heller Financial, Inc. v. Midwhey Powder Co., 883 F.2d 1286,
1294 (7th Cir. 1989). Thus, the requirements of Rule 8 apply to affirmative
defenses. Renalds v. S.R.G. Restaurant Grp., LLC, 119 F. Supp. 2d 800, 802-03
(N.D. Ill. 2000). An affirmative defense must therefore “set forth a ‘short and plain
statement’ of all the material elements of the defense asserted; bare legal
conclusions are not sufficient.” Davis v. Elite Mortgage Servs., 592 F. Supp. 2d 1052,
1058 (N.D. Ill. 2009) (citing Heller, 883 F.2d at 1295).
MobGob’s Second Affirmative Defense is nothing more than a list of the
possible statutory provisions that might serve as a basis for finding the patent-insuit invalid. MobGob’s response fails to even acknowledge that it is well-settled in
this district that pleading a laundry list of legal defenses is not sufficient under
Rule 8:
Courts have held time and time again that stringing together a long
list of legal defenses is not sufficient to satisfy Rule 8(a)’s short and
plain statement requirement. “It is unacceptable for a party’s attorney
simply to mouth ADs in formula-like fashion (‘laches,’ ‘estoppel,’
‘statute of limitations’ or what have you), for that does not do the job of
apprising opposing counsel and this Court of the predicate for the
claimed defense — which after all is the goal of notice pleading.” State
Farm Mut. Auto. Ins. Co. v. Riley, 199 F.R.D. 276, 279 (N.D. Ill. 2001).
Builders Bank v. First Bank & Trust Co. of Illinois, No. 03 C 4959, 2004 WL
626827, *6 (N.D. Ill. Mar. 25, 2004). MobGob’s defense is deficient on its face and
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MobGob has done nothing to argue otherwise. Accordingly, MobGob’s Second
Affirmative Defense should be stricken.
MobGob attempts to justify its deficient affirmative defense by citation to one
non-precedential decision from this district and with a policy argument based on the
disclosure requirements of the Local Patent Rules. Neither, however, relieves
MobGob’s affirmative defenses of the requirements of Rule 8. The sole case MobGob
cites, Pfizer Inc. v. Apotex Inc., 726 F. Supp. 2d 921 (N.D. Ill. 2010), is not even
applicable because it does not concern the pleading standards for affirmative
defenses. Even if it were relevant, its finding that a listing of statutory provisions,
with nothing further, is sufficient to satisfy Rule 8’s “short and plain statement”
requirement conflicts with Heller and the long standing case law from this district
cited above. Furthermore, the Pfizer court’s decision is contrary to the
overwhelming majority of cases that have confronted invalidity affirmative defenses
similar to MobGob’s laundry list of statutory provisions. See Sorensen v. Spectrum
Brands, Inc., 09 CV 58, 2009 WL 5199461, at *1 (S.D. Cal. Dec. 23, 2009) (striking
defense that recited “[t]he claim of the ‘184 patent are [sic] invalid under 35 U.S.C.
§§ 101, 102, 103, and/or 112.”); Sun Valley Bronze, Inc. v. Nobilus, LLC, 72 Fed. R.
Serv. 3d 518 (D. Idaho 2008) (striking a claim reciting “that some or all of the claims
of the ‘873 Patent are invalid for failure to comply with the requirements of 35
U.S.C. §§ 102, 103, and/or 112.”); Aspex Eyewear, Inc. v. Clariti Eyewear, Inc., 531 F.
Supp. 2d 620, 622-23 (S.D.N.Y. 2008) (striking defense that recited “[t]he ‘747
patent is invalid and/or unenforceable for failure to comply with one or more
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provisions of the Patent Laws of the United States, Title 35, United States Code,
Sections 101 et seq., including without limitation Sections 102, 103, and/or 112.”
(language of the defense available at 2007 WL 1993830, at ¶24); Bartronics, Inc. v.
Power-One, Inc., 245 F.R.D. 532, 537 (S.D. Ala. 2007) (striking claims reciting “[o]ne
or more of the claims of the ‘057 patent are invalid under 35 U.S.C. § 103” and
“[o]ne or more of the claims of the ‘057 patent are invalid as being indefinite under
35 U.S.C. § 112.”); Sprint Communications Co. v. Theglobe.com, Inc., 233 F.R.D.
615, 618-619 (D. Kan. 2006) (discussing cases and striking defense that recited
“[defendant] is informed and believes that [plaintiff’s seven patents], and each of the
seven claims thereof, are invalid, void and/or unenforceable under one or more of
the sections of Title 35 of the United States Code”); PB Farradyne, Inc. v. Peterson,
No. C 05-03447, 2006 WL 132182, at *3 (N.D. Cal. Jan. 17, 2006) (striking defense
that recited “[t]o the extent they are alleged to be infringed, the claims of the ‘950
and ‘724 patents are invalid for failure to meet one or more of the requirements of
Title 35, United States Code, including the requirements of sections 102, 103, 112
and/or other applicable statutes.”). This court should thus decline to follow Pfizer.
Likewise, MobGob’s policy argument, seemingly adopted by the Pfizer court,
that dismissal of an invalidity affirmative defense would undermine the Local
Patent Rules, is not only irrelevant, but also incorrect. First, this Court’s Local
Patent Rules are irrelevant because they do not address the pleading requirements
for affirmative defenses, nor any other requirements for pleadings. Second, even if
the local rules were relevant, it would be the local rules that would have to yield to
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the requirements of Rule 8, not vice versa. See United States v. Claros, 17 F.3d
1041, 1044-45 (7th Cir. 1994) (stating that “[a] local rule may not be inconsistent
with the Constitution, a statute of the United States, or with a national rule
governing the conduct of litigation in the United States courts”).
Lastly, MobGob’s policy argument is simply wrong. MobGob cites, in
particular, LPR 2.3, which requires an accused infringer to disclose its initial noninfringement, unenforceability and invalidity contentions. MobGob implies that
since it will have to set forth its basis for its invalidity counterclaims under that
rule, it should not have to meet Rule 8’s pleading requirements. However, MobGob’s
affirmative defense generally lists five section of the statute, 35 U.S.C. §§101, 102,
103, 112 and 116, but LPR 2.3 only requires disclosure of contentions falling under
three statutory sections. The policy argument thus fails because the required
disclosures will not cover all of MobGob’s affirmative defenses. The Court should
therefore reject MobGob’s argument.
B. MobGob’s Standing Defense is an Improper Affirmative Defense
MobGob’s Fifth Affirmative Defense, lack of standing, fails the requirements
of Rule 8 as it does not contain a “short and plan statement” of facts. Heller, 883
F.2d at 1295. MobGob expends a considerable portion of its brief arguing that Iqbal
does not apply to affirmative defenses, but fails to even argue that its qualified
statement – “[t]o the extent Groupon does not own all the rights to the ‘343 Patent”
– satisfies the pre-Iqbal standard set out in Heller. The reason for this is that the
defense obviously does not meet the Heller standard and therefore fails.
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In any event, lack of standing is not an affirmative defense. De Lage Landen
Fin. Svcs. v. M.D.M. Leasing Corp., 07-cv-0045, 2007 WL 4355037, at *3 (N.D. Ill.
Dec. 10, 2007); Garmin Ltd. v. TomTom, Inc., 468 F.Supp. 2d 988, 1012 (W.D.Wis.
2006) (“standing is not an affirmative defense”). Accordingly, MobGob’s Fifth
Affirmative Defense should be stricken by the Court.
III.

CONCLUSION
Based on the foregoing, as well as its Motion to Strike Affirmative Defenses

and the accompanying Memorandum of Law in Support, Groupon respectfully
requests that this Court grant its motion and strike MobGob’s First, Second, Fifth
and Eighth Affirmative Defenses.
Dated: April 14, 2011

Respectfully submitted,
Groupon, Inc.
s/Steven McMahon Zeller
One of its Attorneys
Steven McMahon Zeller
[e-mail]
Kyle A. Davis
[e-mail]
Dykema Gossett PLLC
10 South Wacker Drive, Suite 2300
Chicago, Illinois 60606
Telephone: [phone]
Fax:
[phone]

CHICAGO\3217739.5
ID\KD - 065640/0042

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