Modine Manufacturing Company v. Borg-Warner Inc

Filing 22

ORDER signed by Judge J P Stadtmueller on 3/12/13 denying 12 defendant's Motion to Dismiss. See Order. (cc: all counsel) (nm)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
MODINE MANUFACTURING
COMPANY,
Plaintiff,

Case No. 12-CV-815-JPS

v.
BORG-WARNER, INC.,
Defendant.

ORDER

The plaintiff, Modine Manufacturing Company (Modine), filed its
complaint in this matter on August 10, 2012, alleging that the defendant,
Borg-Warner, Inc. (Borg-Warner), directly infringed, contributorily infringed,
and induced infringement of Modine’s United States Patent No. 8,033,323
(the ‘323 patent). (Docket #1, at ¶ 7). The ‘323 patent covers certain heat and
gas exchange technology, which Modine alleges Borg-Warner is using
illegally in violation of the rights granted to Modine by the ‘323 patent.
(Docket #1, at ¶¶ 5–10). Borg-Warner, by its attorneys, entered its notice of
appearance on December 19, 2012. (Docket #7).
Approximately one month after appearing, Borg-Warner filed a
motion to dismiss Modine’s contributory and induced infringement claims,
which has been fully briefed and is now before the Court. (Docket #12, #13,
#18, #21). In its brief in support of that motion, Borg-Warner argues that
Modine failed to allege facts in its complaint that would be sufficient to state
a plausible claim for relief. (Docket #13, at 1). Modine disagrees, arguing that
its complaint identifies a third party—Navistar—to whom Borg-Warner
allegedly sells the infringing products, which should allow the Court to infer

that its contributory and induced infringement claims are plausible. (Docket
#18, at 1–2). Modine also argues that Navistar’s use of allegedly-infringing
devices is an act of direct infringement, and, therefore, Borg-Warner’s sale of
those devices to Navistar necessarily would entail contributory and induced
infringement. (Docket #18, at 2 (citing 35 U.S.C. § 271(a)). Finally, Modine
also asserts that Borg-Warner’s counterclaim of invalidity is similarly
deficient and unsupported by any alleged facts, requiring dismissal, just as
Borg-Warner argues that Modine’s contributory and induced infringement
claims should be dismissed. (Docket #18, at 2). In the alternative to all of its
arguments against dismissal, Borg-Warner argues that it should be allowed
to amend its complaint, if the Court were to determine that dismissal would
otherwise be appropriate. (Docket #18, at 3 (citing Edgenet, Inc. v. GS1 AIBSL,
2010 U.S. Dist. Lexis 482, 2010 WL 55843 (E.D. Wis. 2010))).
A complaint must contain “a short and plain statement of the claim
showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). The
Court should dismiss any complaint that does not “contain sufficient factual
matter, accepted as true, to ‘state a claim to relief that is plausible on its
face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). However, as Borg-Warner, itself, points
out, “[a]n allegation is facially plausible ‘when the plaintiff pleads factual
content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.’” (Docket #13, at 3 (citing Iqbal,
556 U.S. at 678)).
Here, the Court agrees with Modine that the complaint contains
sufficient factual content to state a claim for relief that is plausible on its face.
Modine’s identification of Navistar as a third-party purchaser of the BorgPage 2 of 4

Warner’s allegedly-infringing product (see Compl. ¶ 8), for use only in
specific models of engines in which the components would have no use other
than infringing uses (see Compl. ¶ 8) and further allegations that BorgWarner is aware of such infringement (see Compl. ¶ 9–10), when taken
together, by inference position Borg-Warner as a potential contributor to and
inducer of infringement. See, e.g., In re Bill of Lading Transmission and
Processing System Patent Litigation, 681 F.3d 1323, 1337 (Fed. Cir. 2012) (citing
35 U.S.C. § 271(c); Cross Med. Prods., Inc. v. Medtronic Sofamor Danek, Inc., 424
F.3d 1293, 1312 (Fed. Cir. 2005)) (noting that contributory infringement
requires the sale or offer for sale of any component for material use in a
patented process, that component having no substantial non-infringing use,
the seller knowing that the component is made for infringing use, and, more
specifically, stating that a plaintiff must “plead facts that allow an inference
that the components sold have no substantial non-infringing uses”; the Court
finds that Modine’s complaint gives rise to an inference of each of these
elements); DSU Med. Corp. v. JMS Co. Ltd., 471 F.3d 1293, 1305 (Fed. Cir. 2006)
(noting that inducement requires that an alleged infringer knowingly aid and
abet another’s direct infringement; if, indeed, Borg-Warner’s product
infringes, then the sale of the product to another may constitute inducement).
Perhaps Modine has not specifically stated the exact facts that would
establish contributory or induced infringement, but that is not what is
required at the pleading stage. Rather, Modine simply needed to allege some
set of facts that would allow the Court to reasonably infer that its
contributory and induced infringement allegations against Borg-Warner are
facially plausible. See, e.g., Iqbal, 556 U.S. at 678. Modine has done so, clearing
the bar at the motion to dismiss stage that is intended, in part, to prevent the
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unnecessary expenditure of funds on discovery for unsupported and
frivolous claims. Modine’s contributory and induced infringement claims are
not frivolous, and clearly have some support in the factual allegations,
however unclear those facts may be at this point. Therefore, it is now time
for the parties to endeavor to complete discovery, during which the
factual background behind all of Modine’s infringement claims—and also
Borg-Warner’s invalidity claims, which are similarly unspecific—will come
into much clearer focus.
Accordingly,
IT IS ORDERED that Borg-Warner’s motion to dismiss (Docket #12)
be and the same is hereby DENIED.
Dated at Milwaukee, Wisconsin, this 12th day of March, 2013.
BY THE COURT:

J.P. Stadtmueller
U.S. District Judge

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