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Judge Stark grants-in-part defendants’ motions to dismiss Clouding IP LLC’s infringement claims

Judge Stark recently considered defendants’ various motions to dismiss Clouding IP LLC’s allegations of infringement filed in three related and coordinated cases. Clouding IP, LLC v. Amazon.com, Inc., et al., C.A. Nos. 12-641-LPS, 12-642-LPS, 12-675-LPS (D. Del. May 24, 2013). First, the Court denied defendant Oracle’s motion to dismiss Clouding’s direct infringement claims because the claims were sufficient under the Federal Rule’s Form 18. Id. at 3-4. The claims identified “a description of the accused Oracle products . . . [and] also identified at least one accused product or product category[.]” Id. at 4. The Court rejected Oracle’s argument that Form 18 also required Clouding “to specify what functionality infringed, or any facts that show how [Oracle] performs even one step of a claimed method.” Id. (internal quotation omitted) (alteration in original).

All defendants moved to dismiss Clouding’s inducement claims because the claims did not adequately plead knowledge of the asserted patents prior to filing the complaint, and failed to plead specific intent to induce infringement. Id. at 5. Clouding argued that its inducement claims were limited to post-filing conduct, thus pre-filing knowledge was not required; and argued that intent was established by Defendants’ continued infringement despite knowledge of the complaint. Id. at 5-6. Judge Stark granted defendants motion, however, because Clouding’s argument “only holds true . . . if the complaint contains
sufficient facts to support an inference that Defendants specifically intended or encouraged others to directly infringe. No such facts are found in Clouding’s [complaints] nd, as a result, Clouding cannot rely on Defendants’ continued infringement to support an induced infringement claim.” Id. at 6.

All defendants also moved to dismiss Clouding’s claims of willful infringement based on Clouding’s failure to allege pre-filing knowledge of the asserted patents, and because Clouding had not sought a preliminary injunction for any post-filing conduct. Id. at 6-7. Judge Stark denied defendants’ motions. Regarding pre-filing knowledge, Clouding argued that because it amended its original complaints to add willful infringement claims, “the time between the filing of the original complaint and the filing of the amended complaint should be deemed ‘pre-filing’ conduct under Seagate.” Id. at 7. (referring to In re Seagate Tech., LLC, 497 F.3d 1360 (Fed. Cir. 2007)). Judge Stark agreed. “For purposes of pleading willful infringement, there appears to be little practical difference between a precomplaint notice letter informing a defendant about a patentee’s allegation of infringement and a subsequently-superceded original complaint formally alleging infringement.” Id. Regarding Clouding’s failure to seek a preliminary injunction, Judge Stark noted that there is no per se requirement that a plaintiff file for a preliminary injunction before raising a willful infringement claim, and Clouding’s claims were not based solely on post-filing conduct since the claims were based at least in part on conduct predating the “operative amended complaint.” Id. at 8.

Clouding IP, LLC v. Amazon.com, Inc., et al., C.A. Nos. 12-641-LPS, 12-642-LPS, 12-675-LPS (D. Del. May 24,…

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