DUCTMATE INDUSTRIES, INC. v. FAMOUS DISTRIBUTION, INC. et al

Filing 137

MEMORANDUM ORDER OF COURT RE: 128 PLAINTIFF'S MOTION TO STRIKE DEFENSE OF INEQUITABLE CONDUCT/MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM RE: COUNTERCLAIM FOR DECLARATORY JUDGMENT OF UNENFORCEABILITY DUE TO INEQUITABLE CONDUCT. 128 Plain tiff's Motion to Strike and/or Motion to Dismiss for Failure to State a Claim is DENIED. All proceedings and required filings as to Defendants' Affirmative Defense of Inequitable Conduct and Counterclaim for Declaratory Judgment of Unenforceability due to Inequitable Conduct are STAYED until resolution of Plaintiff's claims of invalidity and related claims by a jury. Signed by Judge Arthur J. Schwab on 08/19/2014. (lcb) (Main Document 137 replaced on 8/19/2014) (lcb, ).

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
DUCTMATE INDUSTRIES, INC.,
Plaintiff,

12cv1440
ELECTRONICALLY FILED

v.
FAMOUS DISTRIBUTION, INC,
FAMOUS INDUSTRIES, INC.,
Defendants.
MEMORANDUM ORDER RE: PLAINTIFF’S MOTION TO STRIKE AFFIRMATIVE
DEFENSE OF INEQUITABLE CONDUCT AND MOTION TO DISMISS FOR FAILURE
TO STATE A CLAIM RE: COUNTERCLAIM
FOR DECLARATORY JUDGMENT OF UNENFORCEABILITY (DOC. NO. 128)
I. Introduction
This case centers on alleged infringement of four United States Patents: No. 7,478,467
(“the ‘467 Patent”); No. 7,708,034 (“the ‘034 Patent”); No. 8,151,430 (“the ‘430 Patent”); and
No. 8,505,185 (“the ‘185 Patent). Doc. No. 51. Claims before this Court have been raised by
Plaintiff in its five count Complaint for Patent Infringement (Doc. No. 51) and by Defendants in
their First Amended Answer, in which Defendants set forth nine affirmative defenses and nine
counterclaims (Doc. No. 124). Defendants’ Amended Answer includes an affirmative defense
and counterclaim based inequitable conduct in which Defendants contend that Plaintiff, through
its current lead trial counsel and the patents’ inventors, made false statements and failed to
disclose material information during proceedings before the United States Patent and Trademark
Office. Doc. No. 124.
Presently before this Court is Plaintiff’s Motion to Strike Affirmative Defense of
Inequitable Conduct and Motion to Dismiss for Failure to State a Claim re: Counterclaim for

Declaratory Judgment of Unenforceability. Doc. No. 128. Plaintiff moves this Court to strike
Defendants’ affirmative defense of inequitable conduct with prejudice and dismiss Defendants’
counterclaim for declaratory judgment of unenforceability due to inequitable conduct. Id.
Defendants oppose this motion in its entirety. The matter has been fully briefed and is ripe for
disposition. Doc. Nos. 128, 129, 132, 134, 135. After review of the Amended Answer and
applicable case law, Plaintiff’s Motion to Strike Affirmative Defense of Inequitable Conduct
(Doc. No. 128) will be DENIED. However, the affirmative defense of inequitable conduct (ninth
affirmative defense) and counterclaim for declaratory judgment of unenforceability due to
inequitable conduct (ninth counterclaim) will be bifurcated from Plaintiff’s infringement claims.
Discovery and all other proceedings as to inequitable conduct will be stayed until a jury
determination on infringement and other patent issues.
II. Statement of Facts
The following are the pertinent facts of Defendants’ Ninth Affirmative Defense,
Inequitable Conduct, and Ninth Counterclaim, Declaratory Judgment of Unenforceability Due to
Inequitable Conduct, taken as true from Defendants’ Amended Answer solely for the purposes of
this Memorandum Order:
Douglas G. Gudenburr (“Gudenburr”) and Vincent L. Bloom (“Bloom”) are the sole
inventors named on the ‘467 patent, ‘034 patent, ‘430 patent, and ‘185 patent. Doc. No. 124, ¶¶
44 and 45. Each of these patents are directed to the same basic alleged invention, a self-sealing
circular sheet metal duct, and are related to “circular sheet metal ducts” and the “liquid applied
gasketing sealant” applied in the manufacturing of such ducts. Id. at ¶ 45. The ‘034, ‘430 and
‘185 patents claim priority to the ‘467 patent. Id. at ¶ 45. Plaintiff was represented by attorney
2

John M. Thomas during the prosecution of each of these patents. Id. at ¶ 44. Thomas serves as
Plaintiff’s lead trial counsel in this present federal case. Id.
1. Alleged False Assertions Made Related to Prior Art
During the prosecution of the ‘467 patent, Thomas, Gudenburr, and Bloom argued that
the industry and related art is divided between custom made ductwork (square or rectangular)
and mass produced ductwork (circular or round). Id. at ¶ 47. They further argued that because
of this division, the Applicant Admitted Prior Art was inapplicable to the invention in the
pending application. Id. No such division exists between the custom made and mass produced
ductwork. Id. at ¶ 50.
A telephone interview was conducted between Thomas, Gudenburr, and Bloom and a
United States Patent and Trademark Office (“USPTO”) patent examiner on June 25, 2008,
during which prior art was discussed. Id. at ¶ 49. On July 3, 2008, the USPTO patent examiner
rejected pending claims 15-25 over the prior art. Id. at ¶ 48. Thomas, in his response,
summarized the telephone interview, and amended the single independent claim to specify
“circular” duct. Id. at ¶ 49. In October 2008, the patent examiner allowed the claims as
amended. Id. Claims were made, through declarations, about the alleged difference between
circular and square ducts during reexamination proceedings related to the ‘467 patent and the
‘430 patent. Id. at ¶ 51. But for these statements, the patents would not have issued because of
the applicable prior art. Id. at ¶ 53.
2. Alleged Failure to Disclose a Prior Art Manufacturing Process
The manufacturing process of applying a sealant to a locking mechanism or flange duct is
a key distinction between the prior art and the alleged invention. Id. at ¶ 56. Bloom and
Gudenburr failed to disclose that sealant is positioned within a locking mechanism while the duct
3

and locking mechanism are formed on a machine. Id.. The patents would have been rejected
over the prior art or would not have issued if the prior manufacturing process had been disclosed.
Id..
3. Alleged Misrepresentations and Failure to Disclose re: the 5511M Sealant
The prior art mentions use of Ductmate 5511 Sealant. Id. at ¶ 58. Thomas, Gudenburr,
and Bloom told the USPTO that the prior art sealant and Ductmate 5511M Sealant could not be
used on a roll-forming line and packaged, shipped, and stored in bundles. Id. This statement
was false. Id. Thomas, Bloom, and Gudenburr intentionally failed to fully dislose documents
related to the 5511M sealant. Id. at ¶ 59. These documents were relevant to the patents and was
cited by the USPTO to reject at least one of the claims of the ‘034 patent during reexamination.
Id. at ¶ 60.
4. Alleged Misrepresentations Re: Q’So Sealant
Thomas stated that the “Q’So Product does not perform the same function as the claimed
invention” in response to an April 10, 2009 action. Id. at ¶ 62. Gudenburr, Bloom, and Thomas
explained the difference between the Q’So Product and the claimed invention to a USPTO
examiner during a June 25, 2008 interview. Id. at ¶ 63. These statements were false; there is no
difference between the Q’So Product and the products at issue. Id. at ¶¶ 62 and 63. Gudenburr,
Bloom, and Thomas intentionally made material representations to the USPTO. Id. at ¶ 64. But
for these statements, the ‘034 patent and other patents at issue would have been rejected over the
prior art and would not have issued. Id. at ¶ 64.
5. Alleged Failure to Disclose the Nordson FoamMelt 200 Adhesive Applicator
Bloom intentionally failed to disclose the use of the FoamMelt 200 Adhesive Applicator
as prior art during the prosecutions of the patents in issue. Id. at ¶ 66. Plaintiff had a 2003
4

brochure for the applicator in its possession. Id.. If Bloom had disclosed the applicator, the
claim of the patents in dispute would have been rejected and/or would not have issued. Id..
6. Alleged False Statements re: Commercial Success
Thomas submitted a declaration of Edward F. Rafalski during the reexamination
proceedings of the ‘467 patent and the ‘430 patent. Id. at ¶ 70. Rafalski, in his declaration,
asserted that the sealed pipe products were successful enough that Plaintiff discontinued
production of unsealed pipe products. Id. at ¶ 71. This is “incorrect.” Id. Defendants reserve
the right to supplement this claim. Id.
III. Standard of Review
A. Federal Rule of Civil Procedure 12(f)
Under Fed. R. Civ. P. 12(f), a court may, on its own or on a timely motion made by either
party, “strike from a pleading an insufficient defense or any redundant, immaterial, impertinent,
or scandalous matter.” “The purpose of a motion to strike is to clean up the pleadings,
streamline litigation, and avoid unnecessary forays into immaterial matters.” Simmons v.
Nationwide Mutual Fire Ins. Co., 788 F.Supp.2d 404, 407 (W.D. Pa. 2011) (citing McInerney v.
Moyer Lumber & Hardware, Inc., 244 F.Supp.2d 393, 402 (E.D. Pa. 2002).
While “a court possesses considerable discretion in disposing of a motion to strike under
Rule 12(f),” a motion to strike is “not favored and usually will be denied unless the allegations
have no possible relation to the controversy and may cause prejudice to one of the parties, or if
the allegations confuse the issues in the case.” Thornton v. UL Enterprise, LLC, 2010 WL
1004998, *1 (W.D. Pa. Mar. 16, 2010); see In re Fine Paper Antitrust Litig., 751 F.2d 603 (3d
Cir. 1985). “Striking some or all of a pleading [] is considered a drastic remedy to be resorted to

5

only when required for the purpose of justice.” Tennis v. Ford Motor Co., 730 F.Supp.2d 437,
443 (W.D. Pa. 2010).
Motions to strike must be decided on the pleadings alone, and the court should consider
the liberal pleading standards of Rule 8 and the lack of a developed factual record at this early
stage of litigation. Simmons, 788 F.Supp. at 407.
B. Federal Rule of Civil Procedure 12(b)(6) (Generally)
In considering a Rule 12(b)(6) motion, Federal Courts generally require notice pleading,
as opposed to the heightened standard of fact pleading. Fed. R. Civ. P. 8(a)(2) requires only “‘a
short and plain statement of the claim showing that the pleader is entitled to relief,’ in order to
‘give the defendant fair notice of what the . . . claim is and the grounds on which it rests.’” Bell
Atlantic Corp. v. Twombly, 550 U.S. 554, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47
(1957)).
Building upon the landmark United States Supreme Court decisions in Twombly and
Ashcroft v. Iqbal, 556 U.S. 662 (2009), the United States Court of Appeals for the Third Circuit
explained that a District Court must undertake the following three steps to determine the
sufficiency of a claim:
First, the court must take note of the elements a plaintiff must plead to state a
claim. Second, the court should identify allegations that, because they are no more
than conclusions, are not entitled to the assumption of truth. Finally, where there
are well-pleaded factual allegations, a court should assume their veracity and then
determine whether they plausibly give rise to an entitlement for relief.
Connelly v. Steel Valley Sch. Dist., 706 F.3d 209, 212 (3d Cir. 2013) (citation omitted).
The third step of the sequential evaluation requires this Court to consider the specific
nature of the claims presented and to determine whether the facts pled to substantiate the claims
are sufficient to show a “plausible claim for relief.” Covington v. Int'l Ass'n of Approved
6

Basketball Officials, 710 F.3d 114, 118 (3d Cir. 2013). “While legal conclusions can provide the
framework of a Complaint, they must be supported by factual allegations.” Iqbal, 556 U.S. at
664.
This Court may not dismiss a claim merely because it appears unlikely or improbable that
a party can prove the facts alleged or will ultimately prevail on the merits. Twombly, 550 U.S. at
563 n.8. Instead, this Court must ask whether the facts alleged raise a reasonable expectation
that discovery will reveal evidence of the necessary elements. Id. at 556. Generally speaking, a
claim that provides adequate facts to establish “how, when, and where” will survive a Motion to
Dismiss. Fowler v. UPMC Shadyside, 578 F.3d 203, 212 (3d Cir. 2009).
In short, a Motion to Dismiss should not be granted if a party alleges facts, which could,
if established at trial, entitle him/her to relief. Twombly, 550 U.S. at 563, n.8.
IV. Discussion
A. Defendants have Advanced Sufficient Factual Averments to Survive this Motion to
Dismiss/Motion to Strike
Plaintiff contends that Defendants’ affirmative defense and counterclaim based
inequitable conduct do not satisfy the pleading requirements and the allegations should be
stricken and/or dismissed with prejudice, in part because inequitable conduct was pled for the
purpose of disqualifying Plaintiff’s lead trial counsel. Doc. No. 129. Specifically, Plaintiff
argues that: (1) Defendants do not set forth that Thomas, Bloom, or Gudenburr knew assertions
made were false; (2) Defendants do not establish that any failure to disclose was intentional; (3)
facts set forth in the Amended Answer are incorrect; (4) arguments to distinguish prior art cannot
be the basis for inequitable conduct; and (5) Defendants’ allegations do not establish “material”

7

falsehoods. The Court will not address Plaintiff’s third argument because the factual averments
set forth in Defendants’ Amended Answer must be taken as true at this stage.
Actions constitute inequitable conduct when: (1) an individual associated with the filing
and prosecution of a patent application makes an affirmative misrepresentation of a material fact,
fails to disclose material information, or submits false material information; and (2) does so with
a specific intent to deceive the United States Patent and Trademark Office. Exergen Corp. v.
Wal-Mart, 575 F.3d 1312, 1326 (Fed.Cir. 2009) citing Star Scientific, Inc. v. R.J. Reynolds
Tobacco Co., 537 F.3d 1357, 1365 (Fed.Cir. 2008); Molins PLC v. Textron, Inc., 48 F.3d 1172,
1178, 1181 (Fed.Cir. 1995); 37 C.F.R. § 1.56 (2008). As conceded by both Parties, inequitable
conduct must be pled with particularity under Federal Rule of Civil Procedure 9(b) and
applicable case law. Exergen Corp., 575 F.3d at 1326 citing Ferguson Beauregard/Logic
Controls, Div. of Dover Resources, Inc. v. Mega Sys., LLC, 350 F.3d 1327, 1344 (Fed.Cir. 2003).
Thus, this Court’s inquiry centers on whether Defendants’ claim for inequitable conduct is pled
with particularity. It is.
As set forth by Judges of the United States Court of Appeals for the Federal Circuit, the
circumstances of particularity under Rule 9(b) are met if the pleader identifies the “specific who,
what, when, where and how of the material misrepresentation or omission committed before the
PTO. Moreover, although ‘knowledge’ and ‘intent’ may be averred generally, a pleading of
inequitable conduct under Rule 9(b) must include sufficient allegation of underlying facts from
which a court may reasonably infer that a specific individual (1) knew of the withheld material
information or of the falsity of the material misrepresentation, and (2) withheld or
misrepresented this information with the specific intent to deceive the PTO.” Exergen Corp.,
575 F.3d at 1328-29.
8

Defendants have pled sufficient factual averments (when accepted as true and viewed in
the light most favorable to Defendants) to support their inequitable conduct action.1 The
allegations set forth that specific individuals (who) withheld information and made false
statements (what) during proceedings before the USPTO (when and where) that caused the
patent examiner to issue patents that would otherwise not have issued if more information had
been provided and Plaintiff’s representatives had been fully truthful (how). These facts are
sufficient to survive this motion because the facts allow the Court to reasonably infer that the
named individuals acted with the requisite state of mind. Therefore, Plaintiff’s Motion to Strike
Affirmative Defense of Inequitable Conduct and Motion to Dismiss for Failure to State a Claim
re: Counterclaim for Declaratory Judgment of Unenforceability (Doc. No. 128) will be denied.
B. Inequitable Conduct Should be Bifurcated from Infringement
After review of the record to this point and the standard of proof required, the Court finds
that Defendants’ affirmative defense and counterclaim of inequitable conduct should be
bifurcated from Plaintiff’s claims of infringement pursuant to Federal Rule of Civil Procedure
42(b) and stayed until a final determination on infringement and related claims is reached.
Federal Rule of Civil Procedure 42(b) provides that a Court may order a separate trial of
one or more separate issues, claims, crossclaims, counterclaims or third-party claims “for
convenience, to avoid prejudice, or to expedite and economize.” Although bifurcation is the
exception, not the rule, in civil cases, after consideration of this case, a separate trial for
1

At this stage, the Court cannot address Plaintiff’s arguments as to the veracity of Defendants’
factual averments, the existence of evidence that allegedly rebuts Defendants’ facts, or the
“misleading” nature of the inequitable conduct claim. See Doc. No. 135. It is also of no moment
that Defendants may have now “change[d] positions” in their briefs because the Court’s current
inquiry is solely focused on the factual averments contained with the Amended Answer. Doc.
No. 124.
9

infringement and inequitable conduct would serve all three purposes of Rule 42(b). See Lis v.
Robert Packer Hosp., 579 F.2d 819, 824 (3d Cir. 1978) (the decision to bifurcate “must be
decided on a case-by-case basis and must be subject to an informed discretion by the trial judge
in each instance.”). The Court makes this determination mindful of the considerations of
whether bifurcation will avoid prejudice, conserve judicial resources, and enhance juror
comprehension of the issues presented. See SenoRx, Inc., v. Hologic, Inc., 920 F.Supp.2d 565,
565 (D.Del. Jan. 30, 2013) citing Gardco Mfg., Inc. v. Herst Lighting Co., 820 F.2d 1209, 1212
(Fed.Cir. 1987).
Courts across this country have approached inequitable conduct counterclaims and case
management in various ways:


Bench trial on inequitable conduct followed by a jury trial on infringement (Agfa Corp. v.
Creo Products, Inc., 451 F.3d 1366 (Fed.Cir. 2006));



Jury trial on invalidity and infringement conducted simultaneously with a bench trial on
inequitable conduct (evidence on inequitable conduct presented after the jury was
dismissed for the day) (Trading Techn. Int’l, Inc. v. eSpeed, Inc., 750 F.Supp.2d 962
(N.D. Ill. 2010)(see also eSpeed, Inc. v. Brokertec USA, LLC, 480 F.3d 1129 (Fed.Cir.
2007);



Jury trial on invalidity and unenforceability held; Judge weighed evidence from this trial
to determine unenforceability (Dippin’ Dots, Inc. v. Mosey, 476 F.3d 1337 (Fed.Cir.
2007);



Inequitable conduct claim was tried by the Judge while the invalidity decision was on
appeal to the United States Court of Appeals for the Federal Circuit (Se-Kure Controls,
Inc. v. Vaguard, 02-cv-3767 (N.D. Ill. Dec. 18, 2009);
10



Resolution of Defendants’ inequitable conduct counterclaim stayed pending appeal of
validity to the United States Circuit Court for the Federal Circuit (High Concrete
Structures, Inc. v. New Enterprise Stone & Lime Co., Inc., 2003 WL 22358869 (E.D.Pa.
May 27, 2003) (reversed and remanded on other grounds 377 F.3d 1379 (Fed.Cir. 2004);



Court held a jury trial on invalidity and then damages, which was to be followed by
motions practice on inequitable conduct (Marine Polymer Technologies, Inc. v. HemCon,
Inc., Civil No. 06-cv-100 (D. NH. Apr. 8, 2010) later appealed on other grounds 672 F.3d
1350 (Fed.Cir. 2012)).
Patent infringement cases are amongst the most factually and legally complex civil cases.

As currently situated, a jury will have to determine if Defendants’ technologies infringe any of
Plaintiff’s patents and the Court will need to (simultaneously) rule whether Plaintiff’s alleged
conduct bars Plaintiff’s claims. In order to prepare this case for trial, Counsel will need to,
amongst over tasks: complete complex discovery; file any appropriate dispositive motions;
compile evidence that will be presented at trial; depose and prepare witnesses; draft preliminary
and final jury instructions; and file motions in limine. The Court will also have to make rulings
and issue opinions on these matters. Bifurcation will streamline the preparation of this case for
trial because Counsel and the Court will be able to focus on the record related to infringement,
rather than all of the evidence of record. As such, much of the facts that are contested related to
inequitable conduct will not be at issue in the first trial. This will focus pretrial preparation,
which is convenient to both the Court and Counsel, and will aid the jury during any eventual
trial.
This Court’s experience, including in a patent case, has been that juries prefer to only
hear evidence directly related to their determination of distinct issues. See University of
11

Pittsburgh of the Commonwealth System of Higher Education v. Varian Medical Systems, Inc.,
08-cv-1307. Extraneous evidence increases the risk that the jury will become confused or
unfocused. Per applicable case law from the United States Court of Appeals for the Federal
Circuit, inequitable conduct is an issue for the Court, not a jury. Gardco, 820 F.2d 1209; Agfa
Corp., 451 F.3d at 1375; Paragon Podiatry Lab., Inc. v. KLM Lab., Inc., 984 F.2d 1182, 1190
(Fed.Cir. 1993). The Court’s experience in preparing for bench trials has also been that pretrial
practice is improved when counsel can focus on the one or two most important issues. As
currently situated, Counsel and the Court would need to simultaneously expend time, resources,
and energy on two distinct issues: infringement and inequitable conduct and the jury would hear
evidence related to both determinations. This would prejudice the Parties and may serve to delay
the just, speedy, and inexpensive resolution of their disputes. See Fed. R. Civ. P. 1.
The Court is mindful of the need to avoid any prejudice that may result from bifurcation.
If the trial is not bifurcated, the jury would hear evidence related to Plaintiff’s alleged conduct,
which present the serious risk of prejudice to Plaintiff. This situation would present the
possibility that the jury would be so prejudiced against Plaintiff that the jurors would be
incapable of rendering a fair and impartial verdict as to infringement. There is also a risk of
potential confusion if the jury hears evidence of both infringement and inequitable conduct. This
risk does not need to occur.
The issues of infringement and inequitable conduct are readily separable because they are
“distinct and without commonality either as to claims or in relation to the underlying fact issues.”
See Old Town Canoe Co. v. Confluence Holdings Corp., 448 F.3d 1309, 1322 (Fed.Cir. 2006).
In its most basic form, infringement asks the factfinder to determine what Defendants’
technology is and how it compares to Plaintiff’s technology; while inequitable conduct raises
12

issues as to what Plaintiff’s representatives and their Counsel did before the USPTO. There may
be some overlap in the evidence that will be presented before a jury comes to a verdict or the
Court rules, but the Court believes that the majority of the evidence is/will be distinct. As noted
by a fellow United States District Judge, “there is no need to burden the jury with evidence of
equitable misconduct that is to be decided by the Court.” Japan Cash Machine Co. Ltd. V. MEI,
Inc., 2008 WL 5051245 (D. Nev. Nov. 20, 2008). To the extent that there is any overlap in the
evidence, there will not be a need to repeat such evidence during any bench trial on inequitable
conduct because the Court will have heard the evidence while it presides over the jury trial on
infringement.
Bifurcation will not prejudice Defendants. Instead, bifurcation will allow Defendants to
focus on their defenses to infringement. Further, bifurcation may eliminate the need for a trial on
inequitable conduct. If a jury finds that Defendants’ technologies do not infringe any of
Plaintiff’s patents, this would obviate the need for any bench trial on inequitable conduct. While
Defendants may prefer this Court to try the issue of inequitable conduct before infringement, the
Court finds that it is more efficient and more just to try infringement first. This is consistent with
the United States Supreme Court’s holding that “only under the most imperative circumstances .
. . can the right to a jury trial of legal issues be lost through prior determinations of equitable
claims.” Beacon Theatres, Inc. v. Westover, 359 U.S. 500 (1959). Holding the jury trial on
infringement first allows Plaintiff to have their issues heard by a jury. Like other Courts, this
Court does not wish to impinge on this right by holding a bench trial on inequitable conduct
before the jury trial on infringement. See Bard Peripheral Vascular, Inc. v. W.L. Gore &
Assoc.s, Inc., 2007 WL 3208540 (D.Ariz. 2007).

13

Bifurcation will not cause undue delay of the resolution of the Parties’ disputes because it
allows Plaintiff’s claims and eight out of nine of Defendants’ affirmative defenses and
counterclaims to be adjudicated as scheduled. This Court prepares cases for trial through an
expedient pretrial process. If necessary based upon the jury’s verdict, the Court will enter orders
providing for the orderly and expedient resolution of Defendants’ inequitable conduct claim.
Therefore, there is no risk of “considerable delay” due to separate trials and separate pretrial
proceedings. See Laitram Corp. v. Hewlett-Packard Co., 791 F.Supp. 113, 114 (E.D. La. 1992).
Further, bifurcation prevents the need to disturb Plaintiff’s retention of John C. Thomas
as lead trial counsel in this matter. Thomas is very familiar with this case and has been working
to prepare Plaintiff’s claims of infringement for a jury trial since at least October 2012. If
Plaintiff had to obtain new lead trial counsel, this may cause a delay in the Court’s current
scheduling order. This would prejudice the Parties. Bifurcation protects Plaintiff to the extent
that Defendants’ addition of inequitable conduct (approximately 19 months after litigation was
initiated) may have been designed to bar Thomas’ continued representation. See Doc. No. 129,
22-24.
In sum, bifurcation of these distinct issues will allow Counsel, the jury, and the Court to
focus on the key disputes at issue and to prepare for an expedient resolution of the matters at
hand.
V. Conclusion/Order
Defendants have sufficiently pled a claim for inequitable conduct based upon applicable
case law. However, inequitable conduct will be bifurcated from Plaintiff’s claims of
infringement and other related claims and stayed until these claims are resolved by a jury. This
procedure comports with Federal Rule of Civil Procedure 42(b) and promotes judicial economy.
14

This procedure will not prejudice the Parties or impede the just, speedy, and inexpensive
resolution of their dispute. Therefore, the following Order is entered:
AND NOW, this 19th day of August, 2014, IT IS HEREBY ORDERED THAT:
1. Plaintiff’s Motion to Strike Affirmative Defense of Inequitable Conduct; Motion to
Dismiss for Failure to State a Claim re: Counterclaim for Declaratory Judgment of
Unenforceability due to Inequitable Conduct (Doc. No. 128) is DENIED; and
2. All proceedings and required filings as to Defendants’ Affirmative Defense of
Inequitable Conduct and Counterclaim for Declaratory Judgment of Unenforceability due
to Inequitable Conduct are STAYED until resolution of Plaintiff’s claims of infringement
and related claims by a jury.

s/ Arthur J. Schwab
Arthur J. Schwab
United States District Judge

cc:

All Registered ECF Counsel and Parties

15