HTC filed a motion to dismiss Motiva’s claim for willful infringement. HTC asserted that Motiva has failed to adequately allege that HTC had knowledge of the patents-in-suit. HTC also argued that Motiva’s factual allegations of willful blindness are insufficiently specific and otherwise “unsupported” as an evidentiary matter to state a claim for willful infringement.
In analyzing the motion to dismiss, the district court noted that Motiva did not allege actual knowledge for the pre-suit period, but also explained that Motiva was not required to do so as willful blindness could supply the requisite knowledge. Warsaw Orthopedic, Inc. v. NuVasive, Inc., 824 F.3d 1344, 1347 (Fed. Cir. 2016) (recognizing that the Supreme Court has repeatedly held that willful blindness can supply the requisite knowledge for indirect infringement) (citing Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct. 1920, 1926 (2015); see also Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754, 766 (2011).
Accordingly, the district court looked at whether the allegations of willful blindness were pleaded sufficiently. The district court examined two of the factual allegations pleaded by Motiva and found that either were sufficient to satisfy the plausibility standard under the Supreme Court’s decision in Twombly. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007).
Motiva first alleged that HTC “has a policy or practice of not reviewing the patents of others.” The district court noted that creating a policy prohibiting review of patents is a specific kind of “deliberate action to avoid learning” of potential infringement. See Global-Tech, 563 U.S. at 768. This allegation, which the district court had to accept as true at this stage of litigation, raised “a reasonable expectation that discovery will reveal evidence” of the nature, scope, and wording of that policy, in support of Motiva’s claims of willful blindness. The district court concluded that “[s]ince Motiva has alleged that HTC has such a specific policy—a policy prohibiting review of patents—Motiva has plausibly alleged that HTC was willfully blind.”
Second, Motiva alleged that HTC performed specific acts to implement and enforce this policy. The district court explained that Motiva specifically alleges that HTC executed its policy prohibiting review of patents by “instructing its employees to not review the patents of others.” Again, the district court found that “[s]imilar to the allegations related to the existence of HTC’s policy, these allegations plausibly suggest that additional discovery will reveal evidence in support of Motiva’s claim. Twombly, 550 U.S. at 556. Motiva’s allegations plausibly suggest that discovery will reveal what instructions were given by HTC, to whom they were given, and whether HTC’s employees complied. Id. at 556. Accordingly, Motiva has adequately alleged willful blindness on this factual basis as well.”
As a result, the district court denied the motion to dismiss and concluded that “the requirements of Twombly are met when a plaintiff identifies the existence of a specific policy of willful blindness or specific acts of willfully blind conduct. Either factual allegation—the existence of the policy or its implementation in the form of specific acts of willfully blind conduct—is sufficient to state a claim at the pleading stage.
Motiva Patents, LLC v. HTC Corp., Case No. 9-18-CV-00180-JRG-KFG (E.D. Tex. Sept. 27, 2019)
The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. For more information about this case, contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.