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Easton Technical Products, Inc. v. Feradyne Outdoors, LLC

United States District Court, D. Delaware

April 8, 2019

EASTON TECHNICAL PRODUCTS, INC. a Utah corporation, Plaintiff,
v.
FERADYNE OUTDOORS, LLC, a Delaware corporation, Defendant.

          REPORT AND RECOMMENDATION

          Sherry R. Fallon, United States Magistrate Judge

         I. INTRODUCTION

         Presently before the court in this patent infringement action are a motion for judgment on the pleadings seeking dismissal of the inequitable conduct counterclaim and a motion to strike defendant FeraDyne Outdoors, LLC's ("FeraDyne") inequitable conduct affirmative defense, pursuant to Federal Rules of Civil Procedure 12(c) and 12(f) filed by plaintiff Easton Technical Products, Inc. ("Easton"). (D.I. 16) For the reasons that follow, I recommend that the court grant Easton's motions.[1]

         II. BACKGROUND

         On August 9, 2018, Easton originally filed this patent infringement action against FeraDyne, alleging infringement of United States Patent Numbers 7, 004, 859 ("the '859 patent"), 7, 270, 618 ("the '618 patent"), 7, 374, 504 ("the '504 patent"), and 7, 608, 001 ("the '001 patent") (collectively, the "Patents-in-Suit"), which relate to small diameter hunting arrows.[2] (D.I. 1 at ¶¶ 8-12) Eastonis the owner by assignment of the Patents-in-Suit. (Id. at ¶¶ 9-12)

         On October 29, 2018, FeraDyne filed its answer to Easton's complaint, and asserted an inequitable conduct counterclaim (the "Third Counterclaim") and related affirmative defense (the "Ninth Affirmative Defense"). (D.I. 8 at ¶¶ 25-40, 58-64) In its counterclaim, FeraDyne asserted that on August 23, 2006, Mr. Teddy D. Palomaki ("Mr. Palomaki"), Vice President of Product Development for Easton, [3] submitted a declaration to the United States Patent and Trademark Office ("USPTO") pursuant to 37 C.F.R. § 1.132, representing that "Figure 12 of the above-referenced patent application illustrates that the arrow shaft of this invention is new and unique in its combination of spine and outside diameter." (D.I. 8 at ¶ 26) FeraDyne contends that, based on this statement, Mr. Palomaki did not disclose five prior art references, including: (1) U.S. Patent No. 4, 234, 190 ("the '190 patent"), (2) U.S. Patent No. 6, 554, 725 ("the '725 patent"), (3) Eastman's Medallion carbon arrow shafts ("Eastman Medallion arrow shafts"), (4) AFC arrow shafts, [4] and (5) the 1991 Lancaster Archery Supply Catalog[5] (the "Supply Catalog"). (D.I. 8 at ¶¶ 25-40) FeraDyne argues that Mr. Palomaki and Easton engaged in inequitable conduct in failing to disclose this prior art. (D.I. 8 at ¶¶ 25-40; D.I. 21 at 6)

         On November 19, 2018, Easton filed an answer to FeraDyne's counterclaims. (D.I. 12) On December 20, 2018, Easton filed the present motion for judgment on the pleadings and motion to strike FeraDyne's inequitable conduct counterclaims and defense. (D.I. 16)

         III. LEGAL STANDARD

         a. Motion for Judgment on the Pleadings

         Defendant moves for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). Under Federal Rule of Civil Procedure 12(c), "[a]fter the pleadings are closed - but early enough not to delay trial - a party may move for judgment on the pleadings." Fed.R.Civ.P. 12(c). When deciding a Rule 12(c) motion for judgment on the pleadings based on an allegation that the plaintiff has failed to state a claim, the motion "is analyzed under the same standards that apply to a Rule 12(b)(6) motion." Revell v. PortAuth., 598 F.3d 128, 134 (3d Cir. 2010), cert, denied, 131 S.Ct. 995, 178 L.Ed.2d 825 (Jan. 18, 2011).

         To state a claim upon which relief can be granted pursuant to Rule 12(b)(6), 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). Although detailed factual allegations are not required, the complaint must set forth sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007); see also Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). Under this standard, the court must accept all well-pleaded factual allegations as true, and must draw all reasonable inferences in favor of the non-moving party. See Turbe v. Gov't of Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991). This determination is a context-specific task requiring the court "to draw on its judicial experience and common sense." Iqbal, 556 U.S. at 679.

         b. Motion to Strike

         Rule 12(f) permits "[t]he court [to] strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed.R.Civ.P. 12(f). "When ruling on a motion to strike, the [c]ourt must construe all facts in favor of the nonmoving party and deny the motion if the defense is sufficient under the law. Further, a court should not grant a motion to strike a defense unless the insufficiency of the defense is clearly apparent." Symbol Techs., Inc. v. Aruba Networks, Inc., 609 F.Supp.2d 353, 356 (D. Del. 2009) (internal citations and quotation marks omitted). "As a general matter, motions to strike under Rule 12(f) are disfavored." Fesnak & Assocs., LLP v. U.S. Bank Nat 7 Ass'n, 722 F.Supp.2d 496, 502 (D. Del. 2010).

         IV. DISCUSSION

         a. Motion for Judgment on the Pleadings

         The court recommends granting Easton's motion for judgment on the pleadings because FeraDyne's counterclaim for inequitable conduct fails to adequately plead the factual basis with the requisite particularity under Rule 9(b). Rule 9(b) requires a party, when "alleging fraud or mistake . . . [to] state with particularity the circumstances constituting fraud or mistake." Fed.R.Civ.P. 9(b). When a party claims a patent is unenforceable, and the claim is "premised upon inequitable conduct, [it] is a claim sounding in fraud." Senju Pharm. Co. v. Apotex, Inc., 921 F.Supp.2d 297, 305 (D. Del. 2013). '"[I]nequitable conduct, while a broader concept than fraud, must be pled with particularity' under Rule 9(b)." Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312, 1326 (Fed. Cir. 2009) (quoting Ferguson Beauregard/Logic Controls, Div. of Dover Resources, Inc. v. Mega Sys., LLC, 350 F.3d 1327, 1344 (Fed. Cir. 2003)). To plead inequitable conduct "with the requisite particularity under Rule 9(b), the pleading must identify the specific who, what, when, where, and how of the material misrepresentation or omission committed before the [USPTO]." Senju Pharm. Co., 921 F.Supp.2d at 306 (quoting Exergen Corp., 575 F.3d at 1328); see Int'l Bus. Mack Corp. v. Priceline Grp. Inc., C.A. No. 15-137-LPS-CJB, 2017 WL 1349175, at *4-5 (D. Del. Apr. 10, 2017). In addition,

although "knowledge" and "intent" may be averred generally, a pleading of inequitable conduct under Rule 9(b) must include sufficient allegations of underlying facts from which a court may reasonably infer that a specific individual (1) knew of the withheld material information or of the falsity of the material misrepresentation, and (2) withheld or misrepresented this information with a specific intent to deceive the PTO.

Exergen Corp., 575 F.3d at 1328-29.

         Easton argues the court should grant the motion for judgment on the pleadings and motion to strike because FeraDyne has not met the heightened pleading requirements of Rule 9(b) by identifying the "who, what, when, where and how," and has not pleaded any facts to support a finding of but-for materiality or to support an intent to deceive the USPTO. (D.I. 17 at 6-16) In response, FeraDyne argues that it has appropriately pleaded the "who, what, when, where, and how" of Mr. Palomaki's inequitable conduct. (D.I. 21 at 6) Furthermore, FeraDyne contends that it has met the but-for requirement by alleging upon information and belief that the patent ...


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