Holotouch, Inc. v. Microsoft Corporation

Filing 31

OPINION AND ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS re: 19 MOTION to Dismiss Pursuant to Fed. R. Civ. P. 12(B)(6), filed by Microsoft Corporation. For the reasons stated herein, the motion to dismis s is granted in part and denied in part. Count I of the complaint is dismissed for failure to state a claim; Count II remains viable. The clerk is instructed to terminate the motion (ECF 19). The parties shall appear for a status conference on June 1, 2018 at 10:00 a.m., and as further set forth herein. (Status Conference set for 6/1/2018 at 10:00 AM before Judge Alvin K. Hellerstein.) (Signed by Judge Alvin K. Hellerstein on 5/18/2018) (ras)

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USDC SONY
·DOCUMENT
EL ECTRONICALLY FILED~
-DOC#: _ _ _ _ _ _ __
0

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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'DATE FILED:_ 6/t'8 /,zo\f:,

• •

HOLOTOUCH, INC.,
Plaintiff,
-againstMICROSOFT CORPORATION,
Defendant.

OPINION AND ORDER
GRANTING IN PART AND
DENYING IN PART
DEFENDANT'S MOTION TO
DISMISS
17 Civ. 8717 (AKH)

-------------------------------------------------------------- X

ALVIN K. HELLERSTEIN, U.S.D.J.:
This case concerns a patent dispute involving an augmented reality device, known
as the "HoloLens," currently being developed by Microsoft Corporation ("Microsoft"). The
device is a wearable computer built into a pair of smartglasses that allows a user to interact with
holographic images, such as a computer keyboard, without touching a physical object. Plaintiff
Holotouch, Inc. ("Holotouch") filed this case on November 9, 2017, alleging that Microsoft's
HoloLens product infringes on two of its patents: U.S. Patent No. 6,377,238 Bl ("the '238
patent") and U.S . Patent No. 7,054,045 B2 ("the '045 patent"). Broadly speaking, the patents
relate to the control of an input device by interacting with a holographic image of a physical
device, rather than the physical device itself. Microsoft now moves to dismiss the complaint
under Federal Rule 12(b)(6), arguing that the '238 patent expired in 2013, well before this case
arose, and that the allegations in the complaint are otherwise conclusory and fail to state a claim
upon which relief may be granted. For the reasons discussed herein, the motion to dismiss is
granted in part and denied in part. Count I of the complaint is dismissed; Count II remains
viable.

Background
The following facts are taken largely from plaintiffs complaint, which I must
"accept[] as true" for the purpose of this motion. Ashcroft v. Iqbal, 556 U.S . 662, 678 (2009).
A.

HoloLens Product
Microsoft' s HoloLens is a wearable augmented reality device built into a pair of

smartglasses. The device functions as a head-mounted computer system that projects holograms
onto a user' s field of vision, allowing the user to see, hear, and interact with holograms as if they
were a physical object. A marketing image of the HoloLens is produced below:

See-through lenses
Spacial sound
Advanced sensors
Holograph ic Processing Unit

•

Microsoft
Hololens

.Windows10

See Complaint, ECF 1, Fig. 3.

The HoloLens is designed, at least in part, to replace traditional physical
computers by allowing users to interact with a holographic image, rather than a physical
computer, that is projected through high-definition semitransparent holographic lenses. Id. at ,r,r
8, 24- 26. To facilitate this, the headset contains numerous cameras measuring ambient light, the
user' s environment, and the user' s physical movements. Id. at ,r 27- 28. For example, the
HoloLens ' cameras and sensors can be used to project a holographic keyboard onto a user' s field
of vision, translate the user' s hand gestures into typing movements, and allow the user to "type"
onto the holographic keyboard, as shown below:

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Id., Fig. 2; see also id. at ,r 34 ("HoloLens provides a holographic keyboard interface that allows
application developers to build a touchscreen keyboard ... into HoloLens-supported
applications and, therefore, allows users the ability to interact with the holographic keyboard
when using one or more HoloLens software applications."). The HoloLens can also be used to
interact with other user interfaces, as shown below:

Id., Fig. 1. In short, the HoloLens aims to function as a self-contained, wearable holographic
computer system.

B.

Holotouch's Patents
Holotouch is an engineering firm that "works with original equipment

manufacturers to design and build prototypes of devices using HoloTouch' s patented
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technologies." Id. at ,r,r 20-22. Holotouch claims that Microsoft's HoloLens product infringes
on two of its patents that address augmented reality technology: the '238 patent and the '045
patent. Broadly stated, the '238 patent, issued on April 23, 2002, covers the following:
Operator input into one or more devices to be controlled by
the operator is provided through a holographic image of the keys
or other input devices customarily actuated to provide input data to
the system wherein actuation of the holographic image of the input
devices is detected optically without tangible physical contact by
the operator with a solid control object or control surface.
Complaint, ECF 1, Ex. 1, at 1; see also Complaint, ECF 1, at ,r,r 6-9.
The '045 patent, issued on May 30 2006, was intended to improve certain aspects
of augmented reality technology including the power consumption, size, and weight of
conventional devices. Id. at ,r,r 12-13. According to its abstract, the '045 patent covers the
following:
A holographic HMI allows data and commands to be
entered into electronic equipment. The HMI involves no tangible
physical contact between the human operator and the control
elements because the input devices are holographic images of keys
or other customarily touch-activated tangible input elements.
Operator interaction is detected through electromagnetic means,
obviating the need for direct physical contact with any solid input
object or surface. Such HMis generate a holographic image of a
tangible input object of the tangible control mechanism. An
illumination device illuminates the hologram to produce the
holographic image. An actuation detection device detects the
selection by the operator of a holographic image, and a signal
generator receives the detection of the actuation detection device
and provides an input signal to the electronic or electro-mechanical
device thereby to produce the response. The hologram is affixed to
a transparent or translucent material.
Complaint, ECF 1, Ex. 2.

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The complaint alleges that in 2013, Microsoft filed a patent application that cited
Holotouch' s patents as prior art. Complaint, ECF 1, at~ 40. Holotouch then contacted
Microsoft in November 2015, and again in January 2016, to attempt to negotiate a license. Id. at
~

41 . When Microsoft expressed no interest in doing so, this lawsuit followed. Id.

Discussion
In ruling on a motion to dismiss, the court must accept the factual allegations in
the complaint as true and draw all reasonable inferences in favor of the nonmoving party.
Gregory v. Daly, 243 F.3d 687, 691 (2d Cir. 2001), as amended (Apr. 20, 2001). To survive a
motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to 'state
a claim to relief that is plausible on its face .'" Ashcroft, 556 U.S. at 678 (quoting Bell At!. Corp.
v. Twombly, 550 U.S. 544, 570 (2007)). "A claim has facial plausibility when the plaintiff pleads
factual content that allows the court to draw the reasonable inference that the defendant is liable
for the misconduct alleged. " Id.
A suggestion has been made that a more permissive version of the Twombly/Iqbal
standard applies in patent cases in this district. As an initial matter, "Form 18, provided in an
appendix to Rule 84 of the Federal Rules of Civil Procedure, formerly governed the pleading
standards for claims of patent infringement." Bobcar Media, LLC v. Aardvark Event Logistics,
Inc. , No. 16-CV-885 (JPO), 2017 WL 74729, at *3 n.4 (S .D.N.Y. Jan. 4, 2017). But following
amendments to the Federal Rules in 2015 that abrogated Form 18, "the plausibility pleading
requirement of Twombly and Iqbal became the operative standard for pleading patent
infringement." Id. ; L.M Sessler Excavating & Wrecking, Inc. v. Bette & Cring, LLC, No. 16CV-06534-FPG, 2017 WL 4652709, at *4 (W.D.N.Y. Oct. 17, 2017) ("A number of courts to

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address the post-abrogation standard have reasoned that the higher bar of Twombly and Iqbal is
the proper one.").
Acknowledging this, Holotouch argues that the Southern District's Local Patent
Rules, which require plaintiffs to disclose their asserted claims and infringement conditions early
in the case, somehow modify the applicable pleading standard. See In Re: Local Patent Rules of

the Southern and Eastern Districts of New York, 13 Misc. 119 (Apr. 5, 2013). Although I
acknowledge that a minority of out-of-district cases have followed such an approach, 1 I decline
to do so. The Local Patent Rules for the Southern and Eastern Districts are intended to
streamline and standardize the administration of patent cases. But such rules cannot, as
Holotouch contends, abrogate Federal Rules of Civil Procedure or cases of the Supreme Court.

See Orientview Techs. LLC v. Seven For All Mankind, LLC, No. 13 CIV. 0538 PAE, 2013 WL
4016302, at *6 (S.D.N.Y. Aug. 7, 2013) (holding that "the Local Patent Rules and the heightened
pleading standard are not inconsistent," and declining to "measure[]" patent cases "under a
different standard than almost all other claims in this Circuit"); Hon Hai Precision Indus. Co. v.

Wi-LAN, Inc., No. 12 CIV. 7900 SAS, 2013 WL 2322675, at *8 (S.D.N.Y. May 28, 2013)
(holding that "the bodies that implemented the relevant patent rules do not have the authority to
(impliedly) repeal either the Federal Rules of Civil Procedure, or Supreme Court decisions; and
because the fact that invalidity contentions must be served, e.g., forty-five days after the first
status conference has no bearing on the initial sufficiency of a pleading"). The familiar pleading
standard outlined in Twombly and Iqbal applies to this case.

1

See Gracenote, Inc. v. Sorenson Media, Inc., No. 2:16-CV-950 CW, 2017 WL 2116173, at *3 (D. Utah May 15,
2017) ("The Local Patent Rules, in fact, anticipate robust disclosure of 'the particulars behind allegations of
infringement .. . at an early date."' (quoting local rules)); Niazi v. Pressure Prod. Med. Supplies, Inc. , No. 16-CV670-JDP, 20 l 7 WL 108114, at *3 (W.D. Wis. Jan. 11, 2017) ("This court 's preliminary pretrial conference order
will require [plaintiff] to disclose soon precisely what [defendant] is looking for, without the need for motion
practice over the form of the complaint.").

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A.

The '238 Patent
Microsoft first claims that, based on 35 U.S.C. § 154(a)(2), the ' 238 patent was

subject to a 20-year term limit that expired years before this case arose. Under the terms of the
Patent Act, its implementing regulations, and the face of the patent itself, I find that the ' 238
patent expired on April 28, 2013. Because the complaint does not allege that Microsoft infringed
on its patent before it expired, Count I of the complaint must be dismissed.
1.

Patent History
Although the '238 patent was issued on April 23, 2002, its history traces back

much further. The '238 patent application was first filed with the Patent Office on June 6, 1995,
claiming priority to an application originally filed on April 28, 1993. The June 6, 1995 patent
application was denied by the Patent Office Examiner, see Declaration of Sarah E. Jelsema, ECF
21, Ex. C, and the Board of Patent Appeals and Interferences upheld the Examiner's denial on
November 14, 2000, see Declaration of Sarah E. Jelsema, ECF 21, Ex. E.
After the patent was denied, Holotouch supplemented its submission by filing a
Continued Prosecution Application ("CPA") on January 16, 2001 , pursuant to 37 C.F .R.
1.53(d). 2 See Declaration of Sarah E. Jelsema, ECF 21, Ex. F. Crucially, Patent Office
regulations provide that by filing a CPA, Holotouch abandoned its 1995 application. See 37
C.F.R. § 1.53(d)(2)(v). The Patent Office ultimately granted the CPA, and the '238 patent was
issued on April 23 , 2002. See Complaint, ECF 1, Ex. 1.

2

A Continued Process Application, referred to herein as a CPA, was created by the Patent Office in 1997 during an
amendment of37 C.F.R. § l.53(d). See Changes to Patent Practice and Procedure, 62 Fed. Reg. 53 , 132-01 , 53,141
(Oct. 10, 1997). Unlike filing a new patent application or a continuation-in-part application under§ l.53(b), a CPA
is treated as "a request to expressly abandon the prior application as of the filing date of the request." 37 C.F.R.
§ l .53(d)(2)(v).

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2.

The '238 Patent Expired in 2013
Patent duration is governed by statute. Under 35 U.S.C. § 154(a)(2), the grant of

a patent
shall be for a term beginning on the date on which the
patent issues and ending 20 years from the date on which the
application for the patent was filed in the United States or, if the
application contains a specific reference to an earlier filed
application or applications under section 120, 121, 365(c), or
386(c) from the date on which the earliest such application was
filed.
On its face, § 154(a)(2) provides a 20-year term that runs ''from the date on which the earliest

such application was filed." 35 U.S.C. § 154(a)(2) (emphasis added). Because the first
application in this patent' s history was filed on April 28, 1993, a plain reading of§ 154(a)(2)
suggests that the ' 238 patent expired on April 28, 2013 , and that Count I of the complaint must
be dismissed.
To avoid this result, Holotouch argues that the duration of the '238 patent is
governed not by§ 154(a)(2), which was created when the patent laws were amended in 1995 as
part of the Uruguay Round Agreements Act ("URAA"), but by§ 154(c)(l)'s safe-harbor
prov1s10n. § 154(c)(1) provides that
[t]he term of a patent that is in force on or that results from
an application filed before [June 8, 1995] shall be the greater of the
20-year term as provided in subsection (a), or 17 years from grant,
subject to any terminal disclaimers.
35 U.S.C. § 154(c)(l); see also Merck & Co. v. Kessler , 80 F.3d 1543, 1547 (Fed. Cir. 1996). As
the Federal Circuit has explained:
The purpose of the URAA was not to extend patent terms,
although it has that effect in some cases, but to harmonize the term
provision of United States patent law with that of our leading

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trading partners which grant a patent term of 20 years from the
date of filing of the patent application. Prior to June 8, 1995, U.S.
patents had an expiration date under 35 U.S.C. § 154 measured as
17 years from the date the patent issued, except where terminal
disclaimers were filed.

Merck, 80 F.3d at 1547. Put differently, the URAA changed patent terms "from seventeen years
from the date of issuance to twenty years from the date of filing of the patent application."

Bayer AG v. Carlsbad Tech., Inc., 298 F.3d 1377, 1378 (Fed. Cir. 2002). To avoid upsetting
settled expectations, however, Congress enacted§ 154(c)(l), which allowed patent applications
filed by June 8, 1995 to claim a term of"the greater of the 20-year term as provided in
subsection (a), or 17 years from grant." 35 U.S.C. § 154(c)(l); Merck, 80 F.3d at 1548 ("Patents
in the section 154(c)(l) category thus are entitled to keep or to enjoy the 17-year term from
issuance of the patent or a 20-year from filing term, whichever is longer.").
Attempting to take advantage of§ 154(c )(1 ), Holotouch filed a continuation
application on June 6, 1995, two days before the deadline. See Complaint, ECF 1, Ex. 1.
Accordingly, Holotouch claims that the '238 patent expires on April 23, 2019, 17 years after the
date of issuance on April 23, 2002, rather than the 20-year period from the date the first
application was filed, as § 154( a)(2) would otherwise provide.
However, Holotouch cannot rely on § 154(c )(1 )' s safe harbor because by filing
the 2001 CPA, Holotouch abandoned its June 6, 1995 application. See 3 7 C.F.R. 1.53(d)(2)(v)
("An application under filed under this paragraph ... [i]s a request to expressly abandon the
prior application as of the filing date of the request for an application under this paragraph."). In
so doing, Holotouch forfeited the benefit of§ 154(c)(l) and is instead subject to the 20-year term
in § 154(a)(2). This interpretation is confirmed by the statutory language, various regulatory
provisions, and the face of the '238 patent itself.
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First, § 154(c)(1) expressly provides that an applicant may take advantage of the
longer term only if the patent "results from an application filed before" June 8, 1995. 35 U.S.C.
§ 154(c )( 1) (emphasis added). Because the relevant regulations provide that the filing of a CPA
amounts to abandoning the prior application, see 37 C.F.R. l.53(d)(2)(v), the later patent can
hardly be said to have resulted/ram the abandoned application, see 35 U.S.C. § 154(c)(l). This
is especially true where, as here, the June 6, 1995 patent was denied by the Patent Office.
This construction is also consistent with the Patent's Office's contemporaneous
interpretation. After the CPA process was created in 1997, the Patent Office published a
regulation recognizing that "[p ]ermitting the continued prosecution application practice to be
applicable in instances in which the prior application was filed prior to June 8, 1995, would
result in confusion as to whether the patent issuing from the continued prosecution application is
entitled to the provisions of 35 U.S .C. 154(c)." Changes to Continued Prosecution Application
Practice, 63 Fed. Reg. 5732-01, 5733 (Feb. 4, 1998). To avoid this, the Patent Office
harmonized§§ 154(a)(2) and 154(c)(l), explaining that because "the continued prosecution
application practice was not in effect prior to June 8, 1995, no patent issuing from a continued
prosecution application is entitled to the provisions of 35 U.S.C. 154(c)." Id.; see also Ex Parle
Klaus Wellerdieck, Urs Wegmann, & Karl Hoefler, No. 2007-1119, 2007 WL 1314867 (B.P.A.I.
May 4, 2007).
Finally, any ambiguity concerning the patent's term is conclusively resolved by
the face of the patent, which contains a notice stating: "This patent issued on a continued
prosecution application filed under 37 CFR l.53(d), and is subject to the twenty year patent term
provisions of 35 U.S.C. 154(a)(2)." See Complaint, ECF 1, Ex. 1. This undoubtedly put

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Holotouch on notice that the '238 patent would be subject to§ 154(a)(2), rather than§ 154(c)(l),
and would expire 20 years from the original filing date of April 28, 1993.
The pleadings alone demonstrate that the '238 patent is expired. But were the
Court to convert the motion into one for summary judgment under Rule 56 and consider
materials outside the pleadings, In re G. & A. Books, Inc., 770 F.2d 288, 295 (2d Cir. 1985),
Patent Office records also demonstrate that Holotouch was given notice before filing a CPA that
doing so would subject it to the shorter term contained in § 154( a)(2). When Holotouch filed its
CPA on January 11, 2001, the form included a specific notice explaining that "a patent issued on
a CPA . .. is subject to the twenty year patent term provisions of 35 U.S.C. § 154(a)(2)," even if
"the prior application of a CPA may have been filed before, on or after June 8, 1995."
Declaration of Sarah E. Jelsema, ECF 21, Ex. F. The notice further provided that, consistent
with the applicable regulations, "[t]he filing of this CPA is a request to expressly abandon the
prior application as of the filing date for a CPA." Id. Upon receipt of this notice, Holotouch
responded in writing and requested "continuation of prosecution of the subject application,
which is a Continued Prosecution Application (CPA) of prior U.S. Application No. 08/469, 770
filed June 6, 1995." Declaration of Sarah E. Jelsema, ECF 29, Ex. H. There can be no dispute
that Holotouch was on notice that it was subject to the 20-year patent term set out in
§ 154(a)(2). 3

3

Holotouch also suggests that the payment of maintenance fees after the expiration date extends the term of the '238
patent. But the payment of maintenance fees after a patent expires says nothing about the term ofa patent under 35
U.S.C. § l 54(a)(2), and a patent holder surely cannot extent a patent ' s term simply by paying fees after its
expiration . Indeed , the Patent Office notifies patent holders on its website that " utility patents expire after 20 years
from the application filing date subject to the payment of appropriate maintenance fees" and that the Patent Office
"does not calculate the expiration dates for patents." See Declaration of Sarah E. Jelsema, ECF 29, Ex . J, at 8.

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The '238 patent expired on April 28, 2013. Because the HoloLens was
announced in 2016, and the complaint contains no factual allegations that Microsoft infringed on
the ' 238 patent prior to 2013, Count I of the complaint is dismissed for failure to state a claim.

B.

Failure to State a Claim for Direct Infringement
Microsoft separately moves to dismiss the complaint under rule 12(b)(6), arguing

that the claims related to the '045 patent are conclusory. Because I find that the complaint is
sufficient to state a claim, the motion to dismiss Count II is denied.
Holotouch claims that Microsoft's HoloLens directly infringes on various claims
in the '045 patent. 4 Direct infringement claims are governed by 35 U.S.C. § 27l(a), which
provides that "whoever without authority makes, uses, offers to sell, or sells any patented
invention, within the United States or imports into the United States any patented invention
during the term of the patent therefor, infringes the patent." "In order to prove direct
infringement, the plaintiff must establish that a party performed every element of a claimed
invention." Crypto Research, LLC v. Assa Abloy, Inc., 236 F. Supp. 3d 671,685 (E.D.N.Y.
2017); see also Advanced Steel Recovery, LLCv. X-Body Equip., Inc., 808 F.3d 1313, 1319 (Fed.
Cir. 2015) ("To establish literal infringement, every limitation set forth in a claim must be found
in an accused product .. .. " (internal quotation marks omitted) (quoting Southwall Techs. , Inc. v.

Cardinal JG Co., 54 F.3d 1570, 1575 (Fed. Cir. 1995))); Endo Pharm. Inc. v. Amneal Pharm. ,
LLC, No. 12 CIV . 8060 (TPG), 2015 WL 9459823 , at *26 (S.D.N.Y. Aug. 18, 2015) ("Direct
infringement exists if the defendants ' product or methods ... meet each and every element of the
claims.").

4

Because the ' 23 8 patent expired in 2013 and Count I is dismissed, the Court considers the sufficiency of the
allegations only as to Count II , which relate to the ' 045 patent. The '045 patent was granted by the Patent Office on
May 30, 2006 , and there is no dispute that it was in effect at the time of the alleged infringement.

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Microsoft does not suggest that the complaint fails to allege infringement of every
element of the claims. Instead, Microsoft argues that the complaint is deficient because it does
so in a conclusory manner, parroting the language of the patent itself with a perfunctory
attribution to Microsoft. For instance, Microsoft cites paragraph 81 of the complaint, which
reads as follows:
Microsoft's HoloLens is an apparatus which allows an
operator to control an electronic or electro-mechanical device ~
a PC or other type of computing device) of the type conventionally
controlled by a tangible control mechanism (i .e., a keyboard)
having one or more customarily touch-activated tangible input
objects, physical contact with which produces a response by the
electronic or electro-mechanical device .
Complaint, ECF 1, at 1 81 (emphasis added). The majority of this paragraph is taken directly
from the '045 patent; the underlined portions were added to attribute the infringement to
Microsoft and to provide examples clarifying the patent' s technical language. According to
Microsoft, Holotouch repeats this formula throughout Count II, describing each element of the
patent claim in terms of the patent's text.
Were these the only allegations in the complaint, Microsoft might be correct that
Holotouch failed to state a claim. But the complaint contains far more. As detailed above,
paragraphs 6 through 19 of the complaint identify and explain Holotouch' s patents, with
reference to the text of each, and paragraphs 24 through 38 describe Microsoft's HoloLens
product in great detail. Taken with the claims set out in Count II, the detailed description of the
allegedly infringing product sufficiently identifies the factual connection between the HoloLens
product and claims protected by the patent. As the Supreme Court has explained, " [a] claim has
facial plausibility when the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged ." Iqbal, 556 U.S. at

13

678. This is preciously what plaintiff has done here. Nothing more is required to place
Microsoft on notice of the claims against it.
To avoid this result, Microsoft relies heavily on a number of out-of-district cases
for the proposition that " [c]ourts facing similar parroting of claim language as allegations of
infringement have found it to be insufficient under the more exacting standards of Iqbal and
Twombly ." Memorandum in Support of Motion to Dismiss, ECF 20, at 7; see also e.g. , N. Star
Innovations, Inc. v. Micron Tech. , Inc., No. CV 17-506-LPS-CJB, 2017 WL 5501489, at *2 (D.

Del. Nov. 16, 2017); L.M Sessler Excavating & Wrecking, Inc ., 2017 WL 4652709, at *4;
Macronix Int'! Co. v. Spansion Inc. , 4 F. Supp. 3d 797, 804 (E.D. Va. 2014). These cases do not

compel a different conclusion.
For instance, Microsoft cites cases such as L.M Sessler Excavating & Wrecking,
Inc. v. Bette & Cring, LLC, 2017 WL 4652709. The plaintiff in L.M Sessler held a patent

"detail[ing] a process for bridge demolition." Id. At *1. On the defendant's motion, the court
held that "[a]lthough Plaintiff specifies the relevant [New York State Thruway Department of
Transportation] contract and alleges that Defendant performed each step of the patent claim at
issue, it does so using exactly-and entirely-its own patent language." Id. at *4. The court
dismissed the complaint, concluding that " [t]o the extent Plaintiff addresses every element, it is
only by parroting the patent claim and prefacing it with an introductory attribution to
Defendant." Id. at *4. Microsoft also cites North Star Innovations , a case involving a flash
memory patent, in which the court explained that the complaint "does little more than parrot
back the language of these claim elements and then states that the accused product is comprised
of such elements." N. Star Innovations, Inc. v. Micron Tech. , Inc., 2017 WL 5501489, at *2. In
dismissing the complaint, the court held that "a patentee cannot meet its obligation to assert a

14

plausible claim of infringement under the Twombly/Iqbal standard by merely copying the
language of a claim element, and then baldly stating (without more) that an accused product has
such an element." Id.
As an initial matter, the cases on which Microsoft relies are easily distinguishable.
The complaint at issue in L.M Sessler, which totaled only six pages, did nothing more than
specify the relevant government contract and quote the patent. See Amended Complaint, L.M
Sessler Excavating & Wrecking, Inc., No . 16-CV-06534-FPG, 2017 WL 4652709 (W.D.N.Y.

Oct. 17, 2017), dkt. 16. The complaint in North Star Innovations similarly contained no factual
description of the infringing product. See Amended Complaint, N. Star Innovations, Inc., 2017
WL 5501489 (D. Del. Nov. 16, 2017), dkt. 16. Unlike the complaint here, which describes the
allegedly infringing product in great detail, the complaints in L.M Sessler and North Star
Innovations contained no factual allegations sufficient to raise the complaint about a speculative

level.
These cases do not, as Microsoft contends, create an "anti-parroting" principle,
and there is nothing inherently problematic about quoting the language of an allegedly infringed
patent. And more fundamentally, in reviewing the sufficiency of the pleadings under Rule
12(b)(6), I must review the complaint on its own terms. This is an individualized inquiry that is
principally concerned with giving a defendant "fair notice of what the .. . claim is and the
grounds upon which it rests." Twombly, 550 U.S. at 555 (internal quotation marks omitted).
Comparisons to other cases does not help. The central question is whether the complaint,
assumed as true and taken with all reasonable inferences, raises a plausible claim for relief. I
hold that it does .

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Conclusion
For the reasons stated herein, the motion to dismiss is granted in part and denied
in part. Count I of the complaint is dismissed for failure to state a claim; Count II remains
viable. The clerk is instructed to terminate the motion (ECF 19). The parties shall appear for a
status conference on June 1, 2018 at 10:00 a.m.

SO ORDERED.
Dated:

May / 42018
New York, New York
United States District Judge

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