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Judge Fallon recommends the court deny motion to dismiss willful infringement, grant-in-part motion to dismiss inequitable conduct with leave to amend

Judge Fallon recently considered a renewed motion to dismiss Courtesy Products L.L.C.’s willful infringement claims filed by defendant Hamilton Beach Brands, Inc.; as well as Courtesy Products’ motion to dismiss and strike Hamilton Beach’s inequitable conduct claims.  Courtesy Products L.L.C. v. Hamilton Beach Brands, Inc., C.A. No. 13-2012-SLR-SRF (D. Del. Oct. 20, 2015).

Judge Fallon recommended denial of Hamilton Beach’s motion to dismiss because the Court found that under In re Seagate Tech., LLC, 497 F.3d 1360 (Fed. Cir. 2007), the amended complaint adequately pled objective recklessness.  Id. at 6.  In particular, Judge Fallon found sufficient “[t]he amended allegations regarding the knowledge requirement, combined with allegations that Hamilton Beach directly and/or indirectly infringed the patents-in-suit, and that it intentionally advised third party customers to use the accused products in systems that infringe the patents-in-suit[.]”  Id.  Judge Fallon also found that the amended complaint “sufficiently establish[ed] a link between knowledge and objective recklessness by pleading that, ‘[h]aving executed a license in the year 2009 to practice claims of the [patents-in-suit] for a specific product … and thus being on notice of the [patents-in-suit], Hamilton Beach’s continued activities demonstrate a willful disregard of the [patents-in-suit] and thus constitute willful patent infringement.'”  Id. at 8.

Regarding Hamilton Beach’s inequitable conduct allegations, Judge Fallon found that the allegations passed muster except with respect to the “but-for materiality” standard discussed in Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1291 (Fed. Cir. 2011).  Id. at 12-13.  “Neither the challenged pleading nor Hamilton Beach’s answering brief identifies how the cited misrepresentations in the May 21, 2007 response to the PTO’s office action led to the issuance of the patents-in-suit.”  Id.  Although Judge Fallon recommended the Court grant-in-part Courtesy Products’ motion to dismiss on this basis, Judge Fallon also recommended the Court give Hamilton Beach leave to correct the deficiencies.  Id. at 15.

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