SynQor, Inc. v. Ericsson, Inc. et al

Filing 221

MEMORANDUM ORDER adopting 211 Report and Recommendations, denying 152 MOTION to Dismiss Defendant Vicor Corporation's Counterclaims filed by SynQor, Inc., denying 153 Motion to Strike Vicor Corporation's Inequitable Conduct Defensefiled by SynQor, Inc. Signed by Judge Michael H. Schneider on 9/11/12. (mrm, )

IN THE UNITED STATES DISTRICT COURT
OF THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION
SYNQOR, INC.
V.
CISCO SYSTEMS, INC. and VICOR
CORPORATION

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No. 2:11CV54

MEMORANDUM ORDER
The above-entitled and numbered civil action was heretofore referred to United States
Magistrate Judge Caroline M. Craven pursuant to 28 U.S.C. § 636. The Report of the Magistrate
Judge which contains her proposed findings of fact and recommendations for the disposition of such
action has been presented for consideration. SynQor, Inc. (“Plaintiff”) filed objections to the Report
and Recommendation. The Court conducted a de novo review of the Magistrate Judge’s findings
and conclusions.
BACKGROUND
On January 28, 2011, Plaintiff filed this lawsuit against Defendants Ericsson, Inc., Cisco
Systems, Inc., and Vicor Corp. (“Vicor”), alleging infringement of U.S. Patent Nos. 7,072,190 (“the
‘190 patent”); 7,272,021 (“the ‘021 patent”); 7,269,034 (“the ‘034 patent”); 7,558,083 (“the ‘083
patent); and 7,564,702(“the ‘702 patent”). On October 4, 2011, Vicor filed its Answer and
Counterclaims to Plaintiff’s First Amended Complaint, asserting several counterclaims, including
(1) a claim for Declaratory Relief Regarding Unenforceability of the ‘290 patent; (2) a claim under
Massachusetts General Laws Chapter 93A; and (3) a claim for Tortious Interference With
Prospective Business Advantage.
Plaintiff filed a motion to dismiss and a motion to strike Vicor’s three above counterclaims.

According to Plaintiff, Vicor’s inequitable conduct claim cannot satisfy the pleading standards
imposed by the Federal Circuit Court of Appeals in Exergen Corp. v. Wal-Mart Stores, Inc., 575
F.3d 1312 (Fed. Cir. 2009), nor does it include sufficient factual allegations to make a plausible case
of but-for materiality under Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir.
2011) (en banc). Plaintiff further argued that Vicor’s state-law claims are preempted by federal
patent law, and even if not preempted, the claims fail to allege facts tending to show violations of
state law.
REPORT AND RECOMMENDATION
OF THE UNITED STATES MAGISTRATE JUDGE
On August 7, 2012, the Magistrate Judge issued a Report and Recommendation,
recommending SynQor’s motions be denied. Plaintiff filed objections to the Report and
Recommendation, asserting Vicor has failed to state a claim for inequitable conduct. According to
Plaintiff, to survive a motion to dismiss, Vicor must allege facts that plausibly suggest Plaintiff
withheld invalidating information that was withheld from the PTO and withheld that information
with a specific intent to deceive the PTO. Plaintiff takes issue with Vicor’s allegations that despite
Plaintiff’s disclosure of the ‘207 reexamination, Plaintiff should have explained the relationship
between the reexamined claims and the ‘290 patent and provided updates to the examiner regarding
the status of the reexamination of the ‘190 patent. Plaintiff asserts nowhere in its pleading does
Vicor explain how the examiner would have used the withheld information or why it is not
cumulative under Exergen. Finally, in this regard, Plaintiff asserts Vicor’s claim for lack of
materiality fails as a matter of law. According to Plaintiff if “burying” a reference was ever a viable
freestanding theory of inequitable conduct, as held by the Magistrate Judge, Plaintiff asserts it is not
anymore after Therasense.

Regarding the Magistrate Judge’s recommendation denying Plaintiff’s motion to dismiss
Vicor’s state law claims, Plaintiff objects to the Report’s preemption analysis. According to
Plaintiff, prior litigation upholding the same patent forecloses a “sham litigation theory.”
DE NOVO REVIEW
The Court, having reviewed the relevant briefing, the Report and Recommendation,
Plaintiff’s objections, and Vicor’s response to the objections, adopts the Report and
Recommendation of the Magistrate Judge as the findings and conclusions of the Court. Although
the issue is a close one, ultimately the Court agrees with the Magistrate Judge that Vicor has
adequately pled an affirmative defense and counterclaim based on inequitable conduct, but it remains
to be seen whether the inequitable conduct claim will survive a motion for summary judgment.
Similarly, with regard to the presumption issue, the Court denies Plaintiff’s motion to dismiss at this
time, but invites Plaintiff to move for summary judgment on the preemption issue after completion
.
of discovery. Accordingly, it is hereby
ORDERED that SynQor, Inc.’s Motion to Dismiss Defendant Vicor Corporation’s
Counterclaims (Dkt. No. 152) and SynQor, Inc.’s Motion to Strike Vicor Corporation’s Inequitable
Conduct Defense (Dkt. No. 153) are DENIED.
It is SO ORDERED.
SIGNED this 11th day of September, 2012.

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MICHAEL H. SCHNEIDER
UNITED STATES DISTRICT JUDGE