Lear Corporation v. NHK Seating of America Inc.
Filing
164
OPINION and ORDER Granting Lear's Motion to Amend Infringement Contentions 154 . Signed by District Judge Laurie J. Michelson. (EKar)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
LEAR CORPORATION,
Plaintiff,
Case No. 2:13-cv-12937
Honorable Laurie J. Michelson
v.
NHK SEATING OF AMERICA INC.,
NHK SPRING COMPANY, LIMITED, and
NHK INTERNATIONAL INC.,
Defendants.
OPINION AND ORDER GRANTING LEAR’S MOTION TO AMEND
INFRINGEMENT CONTENTIONS [154]
Lear Corporation holds several patents directed toward an active headrest restraint system.
Basically, these patents protect an invention that transfers force from one part of an occupant’s
seat to another during a car crash. More specifically, the invention uses the force that the
occupant’s back places against the seatback during a crash to move the headrest toward the
occupant’s head, thus reducing whiplash during the crash. Lear believes that three related
companies, NHK Seating of America, NHK Spring Company, and NHK International, make an
active headrest restraint system that infringes its patents. So Lear sued the NHK entities.
This case has a long history; at issue now is Lear’s request to make a single amendment to
its final infringement contentions, i.e., its allegations as to how, specifically, the accused product
infringes its patent. Under this Court’s case-management order for patent cases, infringement
contentions usually become “final” about six months into the case. After that, the patent holder
must demonstrate that it has “good cause” for amending its contentions and that the amendment
will not result in “unfair prejudice.” As will be explained, the Court finds that Lear has made the
two showings. So the Court will allow Lear to make a single amendment to its infringement
contentions.
I.
A.
To appreciate the infringement- and invalidity-contention requirements, it may be helpful
to provide a little context. A patent consists of a written description of the invention followed by
one or more claims. See 35 U.S.C. § 112 (pre-AIA). To oversimplify a bit, a claim lists the
invention’s parts and their connections; each item in the list is called a “limitation.” See Dawn
Equip. Co. v. Ky. Farms Inc., 140 F.3d 1009, 1015 n.1 (Fed. Cir. 1998) (providing that the
preferred term is “limitations,” not “elements”). A product infringes the claim of the patent if the
product has (or in patent parlance “meets”) each limitation of the claim. See Dynacore Holdings
Corp. v. U.S. Philips Corp., 363 F.3d 1263, 1273 (Fed. Cir. 2004).
But patent-infringement complaints, requiring only a “short and plain statement of the
claim,” Fed. R. Civ. P. 8, usually do not identify how the defendant’s multi-part device meets each
of the many limitations of the patent’s claims.
Enter infringement contentions. Infringement contentions, with their associated claim
charts, effectively match up the limitations of a patent’s claim with the parts of an accused device
such that the accused infringer knows, specifically, why the patent holder thinks the device
infringes the claim. (See ECF No. 43, PageID.424.)
Invalidity contentions serve a similar purpose. Often when a patent holder asserts that a
product infringes a claim of its patent, the accused infringer turns around and says that the asserted
claim is not valid. One common way that an accused infringer invalidates a patent claim is by
showing that the invention described by the claim is not new or, if it is technically new, it is an
2
obvious extension of things in existence. See 35 U.S.C. §§ 102, 103. In showing that the invention
is not new (or is an obvious extension), the accused infringer also plays a matching game: it
matches up parts of earlier inventions with limitations of the patent claim to show that every
limitation of the claim was already invented. (Again, oversimplifying slightly.)
There are several other ways that a patent claim can be invalid and two are particularly
relevant to the motion now before the Court. For one, a patent claim is invalid if the written
description of the invention does not “reasonably convey[] to those skilled in the art that the
inventor had possession of the claimed subject matter as of the filing date.” Ariad Pharm., Inc. v.
Eli Lilly & Co., 598 F.3d 1336, 1351 (Fed. Cir. 2010) (en banc); see also 35 U.S.C. § 112 ¶ 1 (preAIA). And a patent claim is also invalid if its language does not adequately demarcate the exclusive
territory, i.e., the claim language is indefinite. See 35 U.S.C. § 112 ¶ 2 (pre-AIA); Nautilus, Inc. v.
Biosig Instruments, Inc., 572 U.S. 898, 910 (2014) (providing that claim must “inform those skilled
in the art about the scope of the invention with reasonable certainty”).
So the Court requires the parties to serve infringement and invalidity contentions to force
each side to show its cards: the patent holder shows in detail how the accused device meets each
claim limitation and the accused infringer shows in detail how the claim is invalid. LookSmart
Grp., Inc. v. Microsoft Corp., No. 17-04709, 2019 WL 7753444, at *2 (N.D. Cal. Oct. 17, 2019)
(“The purpose of [infringement and invalidity contentions] is to . . . provide all parties with
adequate notice of and information with which to litigate their cases.” (internal quotation marks
omitted)). But the Court did not only want the parties to show their cards; it wanted the parties to
do so early in the game. Early disclosure helps shape discovery, claim construction, summary
judgment, and, ultimately, trial. See Magna Donnelly Corp. v. 3M Co., No. 07-CV-10688, 2012
WL 12930956, at *4 (E.D. Mich. Feb. 1, 2012) (Michelson, M.J.) (“The purpose of infringement
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and invalidity contentions is to hasten resolution on the merits by providing structure to discovery
and enabling the parties to move efficiently toward claim construction and the eventual resolution
of their dispute.” (internal quotation marks omitted)); Connectel, LLC v. Cisco Sys., Inc., 391 F.
Supp. 2d 526, 527 (E.D. Tex. 2005) (“Specific theories create a specific trajectory for the case.”).
And to ensure that the aims of early, detailed disclosure were not undermined, it made sense to
restrict the parties’ ability to swap out their cards for new ones late in the game. See Verinata
Health, Inc. v. Ariosa Diagnostics, Inc., 236 F. Supp. 3d 1110, 1113–14 (N.D. Cal. 2017) (“The
Patent Local Rules are designed to require parties to crystallize their theories of the case early in
the litigation and to adhere to those theories once they have been disclosed.” (internal quotation
marks omitted)); accord Sloan Valve Co. v. Zurn Indus., Inc., No. 10-204, 2013 WL 622951, at *2
(N.D. Ill. Feb. 20, 2013).
This Court’s case-management order for patent cases accomplishes the above aims through
the following requirements. Two weeks after initial disclosures, the patent holder is required to
serve the accused infringer with its initial infringement contentions. (ECF No. 43, PageID.423.)
The accused infringer then has two weeks to respond to the infringement contentions. (In the
Court’s case-management order, the response is called “Non-infringement Contentions” (ECF No.
43, PageID.425); but to avoid confusion in this opinion, the Court will only use the word
“contention” in association with infringement and invalidity contentions, not the parties’ responses
to those contentions.) Along with its response to infringement contentions, the accused infringer
is required to serve its initial invalidity contentions. (ECF No. 43, PageID.425.) The patent holder
then has two weeks to respond to the invalidity contentions. (Id. § 2.5.) Then, 21 weeks after the
initial infringement contentions have been served, both sides are required to serve their final
contentions. (ECF No. 43, PageID.427.) The exchange is simultaneous. (Id.) These final
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contentions can be amended “only by order of the Court upon a showing of good cause and absence
of unfair prejudice to opposing parties, made within 14 days upon discovery of the basis for the
amendment.” (ECF No. 43, PageID.428.) So within a month or two of the start of the case, both
sides get a good idea of each other’s theories through the exchange of initial contentions; and by
about six months, those theories are crystalized, with limited opportunity to change them.
B.
With that background, the Court turns to the facts relevant to Lear’s motion to amend its
final infringement contentions.
In July 2013, Lear sued NHK Seating of America (NSA). (ECF No. 1.) Lear claimed that
NSA’s active headrest restraint systems infringed the claims of several of its patents, including
U.S. Patent No. 7,455,357 (’357 patent). (See ECF No. 1, PageID.6–7.)
Claim 1 of the ’357 patent includes several limitations. One limitation involves a “four-bar
mechanism.” In particular, claim 1 states in part, “A vehicle seat comprising: a seatback frame for
supporting a back of an occupant; a head restraint extending from the seatback frame for
supporting a head of the occupant; a linkage operably connected to the seatback frame to
collectively provide a four-bar mechanism . . . .” See U.S. Patent No. 7,455,357 col. 5, ll. 63–65,
col. 6, ll. 1–2 (filed Oct. 4, 2006) (emphases added).
The ’357 patent includes a schematic of a four-bar mechanism:
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This schematic shows a “before and after,” in particular, how links 34 (red), 42 (green), and 44
(blue) of the four-bar mechanism move when force is applied. Links 34, 42, and 44 are connected
to one another at pivot points 40 and 46. Before force F is applied to link 42, the configuration of
the four-bar mechanism is as shown on the left portion of the picture. After force F is applied to
link 42 (e.g., when the occupant’s back places force against the seat during an accident), the fourbar mechanism is reconfigured to what is shown in the right portion of the picture. Because links
34 (red), 42 (green), and 44 (blue) of the four-bar mechanism are pivotally connected to each
another (at pivot points 40 and 46), when force F is applied to link 42, it causes link 34 to rotate
around point 36 and link 44 to rotate around point 50. This, in turn, causes the headrest (not shown)
to move.
In October 2017, NSA served its final invalidity contentions on Lear. (See ECF No. 1547, PageID.5496.) As to claim 1 of the ’357 patent, NSA contended that the patent was invalid “for
lack of written description under 35 U.S.C. § 112 ¶ 1.” As noted, § 112 ¶ 1 requires an inventor to
“reasonably convey[] to those skilled in the art that the inventor had possession of the claimed
subject matter as of the filing date.” Ariad Pharm., Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1351
6
(Fed. Cir. 2010) (en banc). NSA’s final invalidity contentions asserted that claim 1 of the ’357
patent was invalid for lack of written description of the claim term “operably connected.” (ECF
No. 154-7, PageID.5495.)
Also in October 2017, Lear served its final infringement contentions on NSA. (ECF No.
154-5, PageID.5477.) (Technically, these were amended final contentions, but that amendment is
not relevant to the present dispute.) Lear’s final infringement contentions included pictures of
NSA’s active headrest restraint system. And on the pictures, Lear identified where it believed the
“four-bar mechanism” limitation of the ’357 patent was found on NSA’s product. Lear did so by
using the labels “First link,” “Second link,” and “Third link”:
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(ECF No. 154, PageID.5482–5483; see also ECF No. 154, PageID.5479.)
In February 2018, Lear filed a separate suit against Japanese entities NHK Spring Company
and NHK International asserting that those two entities also infringed its patents, including the
’357 patent. See Lear Corp. v. NHK Spring Co., No. 18-10613 (E.D. Mich. filed Feb. 21, 2018).
A couple months later, Lear moved to consolidate the two cases. (See ECF No. 88, 95.) In March
2019, the Court denied the motion without prejudice to refiling. Lear Corp. v. NHK Seating of Am.
Inc., No. 13-12937, 2019 WL 1242444, at *2 (E.D. Mich. Mar. 18, 2019). The parties ultimately
agreed to consolidate the two cases for purposes of discovery and summary judgment. (ECF No.
140.)
Several aspects of the parties’ April 2019 stipulation to consolidate are worth highlighting.
Under the parties’ stipulation, except for two exceptions not now relevant, Lear expressly agreed
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“to be bound” by the infringement contentions it served on NSA in October 2017. (ECF No. 140,
PageID.5295.) As part of the stipulation to consolidate, all parties—Lear and all three NHK
entities—agreed to a comprehensive schedule for the remainder of the consolidated case. Notably,
that schedule did not include dates for the exchange of infringement or invalidity contentions. (See
ECF No. 140, PageID.5296–5297.) The case was consolidated in June 2019. (ECF No. 141.)
In October 2019, a dispute over the schedule arose. All parties agreed that the case needed
(yet) another new schedule due to delays in facilitation and depositions in Japan. (ECF No. 151,
PageID.5343.) But the parties disagreed as to what events should be included on the new schedule.
NHK wanted to serve Lear with its own invalidity contentions and response to Lear’s infringement
contentions, i.e., it wanted to take positions different from those taken by NSA. (ECF No. 151,
PageID.5344.) NHK pointed out that under the parties’ stipulation to consolidate, Lear had agreed
to be bound to its infringement contentions, but it had made no similar agreement. (ECF No. 151,
PageID.5348.) For its part, Lear stressed that when the cases were consolidated, the agreed-upon
schedule did not include dates for the exchange of infringement or invalidity contentions. (See
ECF No. 151, PageID.5346.) Lear further argued that allowing NHK to serve its own invalidity
and non-infringement contentions would result in prejudice: “Lear would be prevented from
seeking testimony from NHK . . . regarding such untimely contentions.” (Id.)
The Court held a telephone conference to address this and other disputes. In addressing
NHK’s request to serve its own contentions, the Court focused on Lear’s claim of prejudice: the
timing of NHK’s new invalidity contentions in relation to the then-upcoming depositions in Japan.
The Court directed NHK to serve Lear with its contentions by November 18, 2019, i.e., in time for
the depositions.
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Consistent with this Court’s direction, on November 18, 2019, NHK served Lear with its
first and final invalidity contentions and response to Lear’s infringement contentions. Like NSA,
NHK’s invalidity contentions asserted that claim 1 of the ’357 patent was invalid. But whereas
NSA had relied on § 112 ¶ 1, NHK relied on § 112 ¶ 2. That is, while NSA had argued that the
’357 patent lacked adequate written description for the term “operably connected” in claim 1, NHK
argued that the term “four-bar mechanism” in claim 1 was “indefinite as applied by Lear.” (ECF
No. 154-2, PageID.5430.) NHK explained, “Lear contends that the recited ‘four-bar mechanism’
even covers a six or seven ‘link’ mechanism for transferring force. This application of the claim
renders it indefinite.” (ECF No. 154-2, PageID.5430.)
On January 13, 2020, Lear notified NHK (and, apparently, NSA too) that it believed it was
entitled to serve new infringement contentions in response to NHK’s new assertion of invalidity.
(ECF No. 156, PageID.5532.) NHK (and, apparently NSA too) did not agree. The Court attempted
to reach a resolution short of motion practice. (See ECF No. 153.) But the parties remained at an
impasse.
So on February 3, 2020, Lear filed the motion to amend its final contentions that is the
subject of this opinion. As in the final infringement contentions it had served NSA back in 2017,
Lear maintains that the accused active headrest restraint product meets the “four-bar mechanism”
limitation of claim 1 of the ’357 patent as shown above and reproduced here for convenience:
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But Lear seeks leave to “identif[y] an alternative four-bar mechanism” on the accused device.
(ECF No. 54-8, PageID.5498.) In particular, Lear seeks to amend its infringement contentions to
identify different first, second, and third links of the four-bar mechanism on NHK’s device:
(ECF No. 154-8, PageID.5501.) Not only does Lear seek to include this new infringement theory
as part of its infringement contentions, Lear also seeks to add this theory to its response to NHK’s
invalidity contentions. (ECF No. 157, PageID.5541 n.3.)
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II.
Under this Court’s case-management order, a party may amend its final infringement
contentions “only by order of the Court upon a showing of good cause and absence of unfair
prejudice to opposing parties, made within 14 days upon discovery of the basis for the
amendment.” (ECF No. 43, PageID.428.)
This Court’s case-management order for patent case is based on the local patent rules for
the Northern District of Illinois (with some modifications based on the local patent rules of both
the Northern District of California and the District of Utah). (See ECF No. 43, PageID.419
(explaining source of the case-management requirements).) Courts in that judicial district have
stated that “good cause” requires the party seeking amendment to not only show that “a valid basis
for amendment exists” but also that it “acted diligently.” Oleksy v. Gen. Elec. Co., No. 06-1245,
2013 WL 3944174, at *2 (N.D. Ill. July 31, 2013). And in that district, the party seeking
amendment has the burden of “establishing [both] diligence and lack of prejudice” to the opposing
party. Id. Whether “a party has established the good cause requirement is within the sound
discretion of the district court.” Id.
III.
A.
Lear has “good cause” to amend its infringement contentions to identify an alternative
“four-bar mechanism” in the accused active headrest restraint system.
Start with the fact that but for NHK’s invalidity contentions, Lear would not have asked to
amend its infringement contentions. Lear served its final infringement contentions on NSA back
in October 2017. And there Lear’s infringement positions stood, unaltered, as this case progressed
for two more years. And in those two years much transpired, including adoption of Lear’s
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definition of “four-bar mechanism” during claim construction, see Lear Corp. v. NHK Seating of
Am. Inc., No. 13-CV-12937, 2018 WL 3062189 (E.D. Mich. June 21, 2018), and denial of NSA’s
motion for summary judgment, see Lear Corp. v. NHK Seating of Am. Inc., No. 13-CV-12937,
2019 WL 3892547 (E.D. Mich. Aug. 19, 2019). So Lear had no reason to alter its contentions.
Then, in November 2019, NHK served a never-before-seen invalidity contention. It was only then
that Lear asked to amend its infringement contentions. NHK’s new invalidity theory—one that
NSA had not raised in the many years this case has been pending—supplies Lear with a pretty
good reason for amending its contentions.
But on the unique facts of this case, there is another good reason to allow Lear to amend.
Under this Court’s case-management order, contentions are served in a specific sequence: the
patent holder serves initial infringement contentions, the accused infringer then serves initial
invalidity contentions, and many weeks later, both sides simultaneously exchange final
contentions. (ECF No. 43, PageID.423–427.) So had NSA raised the indefiniteness claim that
NHK now raises in its initial invalidity contentions, Lear would have been able to include its
alternative “four-bar mechanism” in its final infringement contentions. Similarly, if (as NHK
wanted) the two cases had not been consolidated, the Court would have created a separate schedule
for Lear’s case against NHK. And that schedule would have included the standard exchange of
contentions. And under that schedule, had NHK raised its indefiniteness theory in its initial
invalidity contentions, Lear would have been able to include its alternative “four-bar mechanism”
in its final infringement contentions. In other words, in the normal course, a patent holder is
allowed to serve its final infringement contentions after receiving the accused infringer’s initial
invalidity contentions. So returning to that normal course from the current state of affairs supplies
Lear with additional good cause to amend.
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NHK makes a few arguments for why Lear has not demonstrated good cause to amend its
contentions. None persuade.
For one, NHK says that “it is well-settled that invalidity contentions are insufficient cause
to amend infringement contentions.” (ECF No. 156, PageID.5517; see also ECF No. 156,
PageID.5509.) In support of this “well-settled” proposition of law, NHK cites four cases.
In Apple Inc. v. Samsung Electronics Co. Ltd., Samsung argued that deficiencies in Apple’s
noninfringement contentions justified it to amend its infringement contentions. See No. 12-CV0630, 2013 WL 3246094, at *2 (N.D. Cal. June 26, 2013). The court was unpersuaded:
“[D]eficiencies in Apple’s noninfringement theories do not justify Samsung’s delay in asserting
all of the infringement theories it reasonably believed it could assert.” Id. at *4. The court explained
that the process of “fine tun[ing]” infringement contentions as the case progressed was not
intended to be “a running dialogue between the parties, with additions of theories as one side
asserts that a particular argument is unsustainable.” Id. at *3.
NHK also relies on Verinata Health, Inc. v. Ariosa Diagnostics, Inc., 236 F. Supp. 3d 1110
(N.D. Cal. 2017). There, Illumina, a patent holder, “argue[d] that it ha[d] good cause to supplement
its infringement contentions with additional . . . theories because of positions asserted by Ariosa
in its noninfringement contentions.” Id. at 1113. The court relied on Apple and rejected the notion
that Ariosa’s “surpris[ing]” noninfringement positions amounted to good cause for Illumina to
amend its infringement contentions. Id. at 1114. Instead, Illumina needed to show that its
amendments were based on new, non-public information; because Illumina had not made that
showing, it lacked good cause for amendment. Id. at 1115.
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NHK’s third case, Fujifilm Corp. v. Motorola Mobility LLC, has similar facts to Apple and
Verinata and the court followed the reasoning of Apple to deny amendment. See No. 12-CV03587-WHO, 2015 WL 757575, at *8 (N.D. Cal. Feb. 20, 2015).
NHK also cites Northgate Technologies v. Stryker Corp., No. 12-07032 (N.D. Ill. Dec. 16,
2013) (order denying motion to amend contentions). There, “Northgate claim[ed] that the positions
the Defendants [took] in response to Northgate’s final infringement contentions necessitate[d] an
amendment by Northgate.” Id. at 2. The court disagreed; it explained that “the facts [were] the
same” as when Northgate served its final infringement contentions and the only thing that had
changed was the defendants’ legal theory based on those facts. Id. at 3.
Each of these four cases differs from this case in material respects. Apple, Verinata, and
Fujifilm are decisions from the Northern District of California. That district’s local patent rules
(including historical versions in effect at the time of those three decisions) do not provide for initial
and then final contentions.1 The patent holder serves infringement contentions once and
amendment of those contentions is permitted only upon a showing of good cause and the absence
of undue prejudice; effectively, the initial contentions in the Northern District of California are as
malleable as final contentions under this Court’s order. So Apple, Verinata, and Fujifilm are
distinguishable at least because the Northern District of California’s local patent rules do not
contemplate that patent holders will get to serve final infringement contentions after reviewing the
1
N.D. Cal. Patent L.R. 3-1, 3-3, and 3-6 (Jan. 17, 2017) available at
https://www.cand.uscourts.gov/rules/patent-local-rules/
N.D. Cal. Patent L.R. 3-1, 3-3, and 3-6 (Nov. 1, 2014) available at
https://www.cand.uscourts.gov/rules/superseded-local-rules/
N.D. Cal. Patent L.R. 3-1, 3-3, and 3-6 (Apr. 2010) available at
https://web.archive.org/web/20100527202523/http:/www.cand.uscourts.gov/CAND/LocalRul.ns
f/fec20e529a5572f0882569b6006607e0/5e313c0b7e4cd680882573e20062dbcf/$FILE/Pat410.pdf
15
accused infringers’ contentions (invalidity or noninfringement). But, as explained, under this
Court’s sequenced exchange, the patent holder is able to serve its final infringement contentions
after reviewing the accused infringer’s initial invalidity contentions.
As for Northgate v. Stryker, the patent holder, Northgate, was much less diligent than Lear.
There, Northgate amended its complaint to include an indirect infringement theory. Northgate, slip
op. at 1. Yet Northgate did not seek to amend its contentions to include indirect infringement until
almost three months later and after the defendants had served their final non-infringement
contentions. Id. at 2. And, apparently, Northgate could not explain why it had enough information
to amend its complaint to include indirect infringement but had to wait until after the defendants’
final noninfringement contentions to try to add indirect infringement to its infringement
contentions. See id. at 2–3. As compared to Northgate, Lear was much more diligent. True, Lear
did wait about two months after receiving NHK’s invalidity contentions before it disclosed the
details of its alternative four-bar mechanism to NHK. (Compare ECF No. 154-2, PageID.5431
(November 18, 2019), with ECF No. 156-4, PageID.5536 (January 24, 2020).) But Lear explains
that some of the delay was due to counsel’s need to be in Japan for depositions as well as the
holiday season. (ECF No. 157, PageID.5541 n.1.) And Lear implies that its new infringement
contention was not “confirmed” until a January 10, 2020, meeting with its technical expert. (ECF
No. 157, PageID.5541 n.2.) Lear disclosed its new theory to NHK 14 days later. (ECF No. 156-4,
PageID.5536.) So while Lear should have been more diligent, Northgate demonstrated virtually
no diligence.
Although the cases NHK cites do not show that Lear lacks good cause, the Court does
agree with NHK that, often, a new invalidity theory will not be “good cause” for amending
infringement contentions. For example, if an accused infringer identifies an existing invention in
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its final invalidity contentions that it did not include in its initial contentions, and argues that this
existing invention renders the claimed invention not new, the patent holder would likely have no
need to change its final infringement contentions. Whether the claimed invention is different from
the newly identified existing invention is not directly linked to whether the accused device meets
all the limitations of the claim.
But here, there is a direct link. NHK’s invalidity theory is based on Lear’s original
infringement theory. In NHK own words: “Lear contends that the recited ‘four-bar mechanism’
even covers a six or seven ‘link’ mechanism for transferring force. This application of the claim
renders it indefinite.” (ECF No. 154-2, PageID.5430 (emphasis added).) In other words, NHK does
not assert that the language of claim 1 of the ’357 patent, examined in a vacuum, is indefinite;
instead, NHK argues that the way Lear applies the claim language in its infringement contentions
shows that the language is indefinite. So NHK’s invalidity theory effectively attacks Lear’s
infringement theory: “if you allege that we infringe in that manner, then the claim is indefinite.”
Given that NHK’s invalidity theory seeks to negate Lear’s infringement theory (as opposed to
making a stand-alone invalidity theory), Lear has good cause for changing its infringement theory
to account for the NHK’s theory.
But why isn’t the proper solution to limit Lear to responding to NHK’s invalidity
contention with its new infringement theory? After all, this Court’s case-management order
contemplates a patent holder will respond to invalidity contentions separate and apart from its
infringement contentions. (See ECF No. 43, PageID.426.) And allowing Lear to just respond (as
opposed to respond and amend its own contentions) could be fair. Under that scenario, Lear could
try to stave off having claim 1 of the ’357 patent be declared invalid by using its alternative fourbar mechanism but would not be able to use that alternative four-bar mechanism to show that NHK
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is liable. In other words, Lear’s alternative four-bar mechanism would be strictly a shield, not a
sword.
The Court considered this option but, in the end, rejected it. As explained, in the normal
course, Lear would be able to review initial invalidity contentions before serving its final
infringement contentions. NHK’s invalidity contentions are both its initial and final contentions.
So Lear should be able to alter its final infringement contentions to account for any indefiniteness
theory that appears in NHK’s first and only set of invalidity contentions.
NHK makes one other argument against a finding of good cause. NHK says that Lear either
forfeited or waived its right to amend its final infringement contentions when it entered into the
stipulation to consolidate the two cases. (See ECF No. 156, PageID.5509, 5513.)
This argument has some merit but ultimately does not carry the day for NHK. True, in the
stipulation to consolidate, only Lear—and not NHK or NSA—expressly stated it would be
“bound” by its contentions. (ECF No. 140, PageID.5295.) But it is possible that only Lear
expressly agreed to be bound because only Lear had the right to amend in two circumstances. In
other words, the stipulation permits Lear to amend in two circumstances, and thus Lear needed to
expressly agree to not amend in any other circumstance. Lear’s express agreement could therefore
be viewed as a preamble to the two situations where it can amend: “Lear is to be bound by its
infringement contentions set forth in 2:13-cv-12937, with the exceptions of . . . .” (ECF No. 140,
PageID.5295.) NSA on the other hand, had no circumstances in which it could amend. So perhaps
for that reason, NHK and NSA had no reason to expressly agree to be bound.
And while Lear did make an express representation, NHK may have made an implicit one.
As Lear points out, there was a schedule that was part of the stipulation. And that schedule—
agreed to by NHK and NSA—did not include the exchange of contentions. (ECF No. 140,
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PageID.5296–5297.) So Lear’s claim that it thought there would be no further contentions,
including no new invalidity contentions by NHK, is believable. As Lear reasonably relied on the
implication that there would be no further invalidity contentions from NSA or NHK, but that turned
out not to be the case, it would be inequitable to hold Lear to its promise to be bound.
B.
That leaves the issue of “unfair prejudice.” Here, the Court can be much briefer.
Lear says NHK will not suffer prejudice. It stresses that it is asking to amend its
infringement contentions for “only one limitation (‘four-bar mechanism’) of one claim (claim 1)
of the one ‘357 Patent.” (ECF No. 154, PageID.5425.) And Lear explains that when it moved to
amend, expert reports on infringement and invalidity were still months away. (ECF No. 154,
PageID.5425.) (Those dates are closer now, but that is not Lear’s fault.) Further, Lear says that its
amendment will not affect the schedule for the case and that it “will not oppose NHK amending,
within a reasonable time, its contentions to the extent they” are responsive to Lear’s amendment.
(Id.)
In response, NHK does not specify any prejudice from Lear’s amendment. True, NHK says
that it relied on Lear’s promise to be bound to its infringement contentions in agreeing to
consolidate the NHK and NSA cases. (See ECF No. 156, PageID.5510 (“To convince NHK and
NSA to agree to consolidation, Lear stipulated that it would not change its Final Infringement
Contentions.”); see also ECF No. 156, PageID.5513, 5520–5521.) But NHK does not explain how
that reliance results in prejudice. NHK merely says, “Allowing Lear to shift its positions well after
the stipulated consolidation was granted with Defendants’ concurrence is incurably prejudicial to
Defendants.” (Id.) But how? NHK does not say.
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IV.
In short, the Court finds that Lear has shown that it has good cause for amending its
infringement contentions regarding the “four-bar mechanism” limitation of claim 1 of the ’357
patent and that amending that limitation will not result in unfair prejudice to NSA or NHK.
Accordingly, within 7 days of this order, Lear shall serve on NSA and NHK the amended
infringement contention attached to its motion. (ECF No. 154-8, PageID.5498, 5501.) NSA and
NHK will then have 21 days to serve amended non-infringement contentions and, if necessary,
amended invalidity contentions.
SO ORDERED.
Dated: April 10, 2020
s/Laurie J. Michelson
LAURIE J. MICHELSON
UNITED STATES DISTRICT JUDGE
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