Trutek Corp. v. BlueWillow Biologics, Inc.

Filing 50

OPINION and ORDER Denying 44 Motion to Amend/Correct. Signed by District Judge Stephen J. Murphy, III. (DPar)

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1038 Filed 11/17/22 Page 1 of 8

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
TRUTEK CORP.,

Case No. 2:21-cv-10312

Plaintiff/Counter-Defendant,

HONORABLE STEPHEN J. MURPHY, III

v.
BLUEWILLOW BIOLOGICS, INC.,
Defendant/Counter-Plaintiff.

/

OPINION AND ORDER DENYING
MOTION FOR LEAVE TO AMEND COMPLAINT [44]
Plaintiff sued Defendant for patent infringement. ECF 1, PgID 6. Defendant
denied Plaintiff’s allegations. ECF 9, PgID 84. After the parties submitted briefing
for a claim construction hearing, Plaintiff moved to amend the complaint and add a
claim of willful patent infringement. ECF 44. The parties briefed the motion. ECF 47;
48. For the reasons below, the Court will deny the motion. 1
BACKGROUND
The United States Patent and Trademark Office assigned Plaintiff United
States Patent Number 8,163,802 (the ’802 patent). ECF 1, PgID 2–3. The patented
technology allows consumers to apply Plaintiff’s “products in and around their nasal
passages to reduce reactions to airborne allergens and to reduce or eliminate
reactions to viral infections” such as the flu. Id. at 3. Plaintiff’s technology eliminates

Based on the parties’ briefing, the Court will resolve the motion on the briefs without
a hearing. See Fed. R. Civ. P. 78(b); E.D. Mich. L.R. 7.1(f)(2).

1

1

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1039 Filed 11/17/22 Page 2 of 8

viruses “by establishing an electrostatic charge in and around nasal passages.” Id.
Defendant sells a product called NanoBio Protect. ECF 1, PgID 4; ECF 9, PgID 72.
The product is also applied to the nasal passages and “kill[s]” germs. ECF 1, PgID 4.
Plaintiff sued Defendant for patent infringement and alleged that Defendant’s
product infringed on Plaintiff’s ’802 patent because “[t]he ability to lessen the
reactions to airborne contaminants by creating an electrostatic charge around a
person’s nasal passages is inherent in [Plaintiff]’s formulations and manufacturing
processes.” Id. at 6. Plaintiff argued that Defendant’s product uses benzalkonium
chloride, the same substance Plaintiff uses in its product. Id. at 4, 7. Defendant
denied Plaintiff’s allegations, and argued that the ’802 patent was “invalid and has
not been . . . infringed by [Defendant].” ECF 9, PgID 84.
After the close of discovery, Plaintiff moved to amend its complaint to add a
claim of willful patent infringement. ECF 44. Plaintiff argued that it had not learned
of the need for an amendment until Defendant produced its financial disclosures one
month after the close of discovery. Id. at 799. In its proposed amended complaint,
Plaintiff alleged that Defendant had “received notice” that its product infringed
Plaintiff’s patent “when Plaintiff filed the original complain[t].” ECF 44-1, PgID 819.
Yet Defendant “continued to market, distribute, and sell NANOBIO products for
months after learning that the NANOBIO products infringed on claims 1, 2, 6[,] and
7 of the ’802 patent.” Id. at 823. Defendant’s financial records, maintained Plaintiff,
established “by a preponderance of the evidence that enhanced damages [were]

2

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1040 Filed 11/17/22 Page 3 of 8

appropriate.” Id. at 819. Plaintiff requested that Defendant be required to pay
Plaintiff for all gains it derived from the infringement of the ’802 patent. Id. at 824.
LEGAL STANDARD
Federal Rule of Civil Procedure 15(a)(2) provides that after a responsive
pleading is filed and twenty-one days has elapsed, a party may only amend a pleading
with the written consent of the opposing party or with leave of the Court. Rule 15(a)(2)
also provides that “[t]he [C]ourt should freely give leave when justice so requires.”
See also Foman v. Davis, 371 U.S. 178, 182 (1962). To determine whether to grant
leave to amend a pleading, the Court relies on six factors: (1) “undue delay in filing”;
(2) “lack of notice to the opposing party”; (3) “bad faith by the moving party”;
(4) “repeated failure to cure deficiencies by previous amendments”; (5) “undue
prejudice to the opposing party”; and (6) “futility of [the] amendment.” Wade v.
Knoxville Utils. Bd., 259 F.3d 452, 458–59 (6th Cir. 2001) (quotation omitted).
DISCUSSION
Plaintiff moved for leave to amend its complaint to add a claim of willful patent
infringement. ECF 44. The Court will deny the motion based on three of the factors:
undue delay, undue prejudice to Defendant, and futility of the amendment.
I.

Undue Delay
The Court will first deny the motion for leave to amend the complaint because

of Plaintiff’s “undue delay in filing.” Wade, 259 F.3d at 458. There is “an increased
burden” on a party that moves to amend a complaint after the close of the discovery.
Duggins v. Steak ‘N Shake, Inc., 195 F.3d 828, 834 (6th Cir. 1999) (citation omitted).

3

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1041 Filed 11/17/22 Page 4 of 8

The moving party must “show justification for the failure to move earlier.” Id. In
short, Plaintiff offered little to no justification for waiting to move for leave to amend
at the present late point in the litigation. Indeed, Plaintiff’s motion was filed more
than five months after the close of discovery and less than a month before the close
of expert discovery. 2 See Bridgeport Music, Inc. v. Dimension Films, 410 F.3d 792,
806–07 (6th Cir. 2005) (affirming a district court’s denial of leave to amend a
complaint with only a few weeks left in discovery); R.S.W.W., Inc. v. City of Keego
Harbor, 397 F.3d 427, 440–41 (6th Cir. 2005) (affirming a district court’s denial of
leave to amend a complaint after the close of discovery). And Plaintiff could have
easily discovered Defendant’s knowledge of its alleged willful infringement in other
ways. For instance, Plaintiff could have searched for Defendant’s product online or at
a local pharmacy as it had done before the case was filed. ECF 44-1, PgID 849–55;
ECF 1-5, PgID 32–33. Yet Plaintiff did not explain that it had not taken any such
action before filing the previous complaint. See Scott v. Hemlock Semiconductor Corp.,
No. 06-14903, 2007 WL 2649360, at *3 (E.D. Mich. Sept. 10, 2007) (denying motion
to amend because no explanation was given for why a claim was not brought in the
previously filed complaint).
Instead, Plaintiff argued that its delay in filing the present motion was not
undue because it was based on information contained in Defendant’s financial
records, which were not provided to Plaintiff until one month after the close of

Discovery closed on May 16, 2022. ECF 26. Plaintiff filed its motion for leave to
amend on October 25, 2022. ECF 44. Expert discovery closed on November 14, 2022.
ECF 26.

2

4

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1042 Filed 11/17/22 Page 5 of 8

discovery. 3 ECF 44, PgID 799–800; ECF 47, PgID 909; ECF 48, PgID 932. Plaintiff
blamed Defendant for the “delayed” disclosure, which in turn caused Plaintiff to not
“have the opportunity to scrutinize details regarding the sales of the Nano[B]io
product” until after the close of discovery. ECF 44, PgID 807. Plaintiff is correct that
Defendant did not provide the financial records until one month after the close of fact
discovery. 4 But Plaintiff delayed another four months to file the present motion.
Compared with Defendant’s one-month delay, Plaintiff’s four-month delay was
undue. The factor thus cuts against granting Plaintiff’s motion for leave to amend.
II.

Prejudice
The Court will also deny Plaintiff leave to amend the complaint because an

order granting the motion would result in “undue prejudice to the opposing party.”
Wade, 259 F.3d at 458–59. Courts consider “whether the assertion of the new
claim . . . would[] require the opponent to expend significant additional resources to
conduct discovery and prepare for trial.” Phelps v. McClellan, 30 F.3d 658, 662–63
(6th Cir. 1994). Here, granting leave to amend would create undue prejudice to
Defendant because it would require Defendant to “expend significant additional
resources” to respond to the new claim. Id. at 663. Willful patent infringement is,
after all, a fact-intensive issue that requires the examination of multiple factors,
including “whether the infringer deliberately copied the ideas or design of another,”

Plaintiff did not attach the financial records to its motion, nor did it cite any
authority in support of the contention.
4 Defendant provided the financial records in June 2022. ECF 47, PgID 909–10. The
discovery period ended on May 16, 2022. ECF 26.
3

5

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1043 Filed 11/17/22 Page 6 of 8

the “remedial action by the defendant,” and “whether defendant attempted to conceal
its misconduct.” Sunoco Partners Mktg. & Terminals L.P. v. U.S. Venture, Inc., 32
F.4th 1161, 1177 (Fed. Cir. 2022).
Beyond that, Defendant would be unduly prejudiced because, as in Duggins,
195 F.3d at 834, Defendant would be compelled to reopen discovery. And reopening
discovery would cause significant prejudice because it would require new
investigation into, among other things, whether and when Defendant received notice
of the alleged infringement; whether Defendant was aware of the alleged
infringement as it was distributing its product; and whether Defendant intentionally
continued distributing its product despite receiving notice. Plus, the dispositive
motions deadline is less than a month away. See Miller v. Admin. Off. of Cts., 448
F.3d 887, 898 (6th Cir. 2006) (finding prejudice because the motion to amend the
complaint was filed soon before the dispositive motions deadline). Any work toward
crafting a dispositive motion would likely need to be altered or even redone based on
new information that might be obtained through the extended discovery period. All
told, Defendant would by unduly prejudiced by the proposed amendment. The factor
thus weighs against Plaintiff’s motion.
III.

Futility
Last, the Court will deny the motion for leave to amend because the proposed

amendment would be futile. A proposed amendment is futile if the complaint could
not survive a motion to dismiss. Wade, 259 F.3d at 458–59. The proposed amended
complaint must therefore allege facts “sufficient ‘to raise a right to relief above the

6

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1044 Filed 11/17/22 Page 7 of 8

speculative level,’ and to ‘state a claim to relief that is plausible on its face.’” Hensley
Mfg. v. ProPride, Inc., 579 F.3d 603, 609 (6th Cir. 2009) (quoting Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555, 570 (2007)).
To establish willful patent infringement, a party must demonstrate both
knowledge of the patent and knowledge of the infringement. WBIP, LLC v. Kohler
Co., 829 F.3d 1317, 1339–41 (Fed. Cir. 2016). The Court has the discretion to award
enhanced damages based on factors including “whether the infringer deliberately
copied the ideas or design of another,” the “infringer’s behavior as a party to the
litigation,” the infringer’s “size and financial condition,” the “closeness of the case,”
“remedial action by the defendant,” the defendant’s “motivation for harm,” and
“whether [the] defendant attempted to conceal its misconduct.” Sunoco Partners, 32
F.4th at 1177.
Here, the proposed amended complaint failed to allege sufficient facts to move
beyond the level of speculation. Plaintiff alleged, for example, that Defendant had
“received notice” that its product infringed Plaintiff’s patent “when Plaintiff filed the
original complain[t].” ECF 44-1, PgID 819. Despite receiving notice, “Defendant[]
continued to market, distribute, and sell NANOBIO products for months after
learning that the NANOBIO products infringed on claims 1, 2, 6, and 7 of the ’802
patent.” ECF 44-1, PgID 823. Yet Plaintiff’s argument requires the assumption that
Defendant infringed the patent, a legal conclusion that has yet to be proven. And
merely pleading awareness of the patent “is not enough to sustain a willful

7

Case 2:21-cv-10312-SJM-RSW ECF No. 50, PageID.1045 Filed 11/17/22 Page 8 of 8

infringement claim.” Mich. Motor Techs. LLC v. Volkswagen Aktiengesellschaft, 472
F. Supp. 3d 377, 384–85 (E.D. Mich. 2020) (collecting cases).
Plaintiff also alleged in the proposed amendment that Defendant’s “[financial]
records establish by a preponderance of the evidence that enhanced damages are
appropriate.” ECF 44-1, PgID 819. But Plaintiff failed to support its argument with
any facts about the financial records. See id. at 819–23. Indeed, it did not attach the
financial records to its motion. What is more, Plaintiff claimed only that Defendant
had notice of the alleged infringement and continued to sell its product. See id.
Plaintiff’s new, proposed allegations stop short of establishing that Defendant
intentionally infringed the patent. Kohler, 829 F.3d at 1341; see also Gustafson, Inc.
v. Intersystems Indus. Prod., Inc., 897 F.2d 508, 510–11 (Fed. Cir. 1990). In sum, the
proposed amended claim is futile because it would not survive a motion to dismiss
given the new claims’ speculative and conclusory nature. The Court will therefore
deny Plaintiff’s motion to amend the complaint.
WHEREFORE, it is hereby ORDERED that Plaintiff’s motion for leave to
amend the complaint [44] is DENIED.
SO ORDERED.

Dted: November 17, 2022

s/ Stephen J. Murphy, III
STEPHEN J. MURPHY, III
United States District Judge

I hereby certify that a copy of the foregoing document was served upon the parties
and/or counsel of record on November 17, 2022, by electronic and/or ordinary mail.
s/ David P. Parker
Case Manager
8