United States District Court, D. Delaware
LIQWD, INC. and OLAPLEX LLC, Plaintiffs,
L'ORÉAL USA, INC., L'ORÉAL USA PRODUCTS, INC., L'ORÉAL USA S/D, INC., and REDKEN 5TH AVENUE, NYC, L.L.C., Defendants.
MEMORANDUM AND ORDER
F. Bataillon, Senior United States District Judge.
matter is before the Court on Magistrate Judge Fallon's
Report and Recommendation, D.I. 430, regarding
Plaintiff's Liqwd, Inc.'s (“Liqwd”) and
Olaplex, LLC's (“Olaplex”) (collectively
“Plaintiffs”) renewed motion for a preliminary
injunction, D.I. 239, and Defendants' L'Oréal
USA, Inc, L'Oréal U.S. Product, L'Oréal
USA S/D, Inc., L'Oréal S.A., and Redken
5TH Avenue NYC, LLC (collectively
“Defendants”) motion to strike the declaration of
Nisha Mody, Ph.D., D.I. 266. The magistrate judge recommended
granting Plaintiffs' motion for preliminary injunction
and denying Defendants' motion to strike.
brought this action alleging patent infringement under 35
U.S.C. § 1 et seq., misappropriation of trade
secrets under Defend Trade Secrets Act and Delaware Trade
Secrets Act, and breach of contract (specifically, a
nondisclosure agreement (“NDA”)). D.I. 636, Third
Amended Complaint. In particular, Plaintiffs argue that
Defendants have infringed U.S. Patent No. 9, 498, 419 (the
“'419 Patent”) owned by Plaintiffs. D.I. 240,
at 1. Defendants have alleged they are not infringing
Plaintiffs' patents, the patents are invalid, and
Plaintiffs have engaged in false advertising and breach of
contract. D.I. 650. The patents involve “Keratin
Treatment Formulations and Methods” for hair care
products. Olaplex filed the present action on January 5, 2017
against L'Oréal after dismissing a previously
filed California case known as the “California Action,
” asserting causes of action for the alleged
infringement of the '419 patent, misappropriation of
trade secrets under the Defend Trade Secrets Act,
misappropriation of trade secrets under the Delaware Trade
Secrets Act, unjust enrichment, breach of contract, and
breach of the implied covenant of good faith and fair
dealing. D.I. 2. On January 17, 2017, Olaplex filed a motion
for a preliminary injunction, alleging that it had suffered
and would continue to suffer irreparable harm unless
L'Oréal's infringement was enjoined. D.I. 14.
beginning stages of the case, Plaintiffs filed a motion for
preliminary injunction, D.I. 14, which was denied by Judge
Robinson. D.I. 135. The order denying the motion was appealed
to the Federal Circuit. D.I. 136. The Federal Circuit vacated
the denial of the preliminary injunction and remanded to the
district court for further proceedings. D.I. 176, Ex. 1. The
motion was referred to Magistrate Judge Fallon on April 4,
2018 and the motion was later terminated on April 27, 2018.
Plaintiff filed a second amended complaint which this Court
granted. D.I. 234. Defendant previously filed a motion to
dismiss. D.I. 66. The Court denied the motion to dismiss.
D.I. 234. Upon the motion being terminated, Plaintiffs made a
renewed motion for preliminary injunction. D.I. 239.
Plaintiffs accompanied their renewed motion with a
declaration submitted by Nisha Mody, Ph.D., D.I. 243.
Defendants filed a motion to strike Dr. Mody's
declarations. D.I. 266.
October 15, 2018, the magistrate judge filed a report and
recommendation which addressed the renewed motion for
preliminary injunction and the motion to strike. D.I. 430.
The magistrate judge recommended granting the motion for
preliminary injunction and denying the motion to strike.
Id. After the report and recommendation was issued,
Defendants filed an objection. D.I. 468. Additionally,
Defendants have filed two motions to reopen and supplement
the record relating to the renewed motion for preliminary
injunction. D.I. 469 and D.I. 604.
standard of review for a report and recommendation is
governed by 28 U.S.C. § 636(b)(1)(C) and Federal Rule of
Civil Procedure 72(b). The district court “shall make a
de novo determination of those portions of the report or
specified proposed findings or recommendations to which
objection is made” and “may also receive further
evidence or recommit the matter to the magistrate judge with
instructions.” 28 U.S.C. § 636(b)(1)(C).
Similarly, Rule 72(b)(3) requires de novo review of any
recommendation that is dispositive of a claim or defense of a
Supreme Court has construed the statutory grant of authority
conferred on magistrate judges under 28 U.S.C. § 636 to
mean that nondispositive pretrial matters are governed by
§ 636(b)(1)(A) and dispositive matters are covered by
§ 636(b)(1)(B). Gomez v. United States, 490
U.S. 858, 873-74 (1989); see alsoFed. R. Civ. P.
72(a). Under subparagraph (B), a district court may refer a
dispositive motion to a magistrate judge “to conduct
hearings, including evidentiary hearings, and to submit to a
judge of the court proposed findings of fact and
recommendations for the disposition.” 28 U.S.C. §
636(b)(1)(B); see EEOC v. City of Long
Branch, 866 F.3d 93, 99-100 (3d Cir. 2017). The product
of a magistrate judge, following a referral of a dispositive
matter, is often called a “report and
recommendation.” Id. “Parties ‘may
serve and file specific written objections to the proposed
findings and recommendations' within 14 days of being
served with a copy of the magistrate judge's report and
recommendation.” Id. (quoting Fed.R.Civ.P.
a party objects timely to a magistrate judge's report and
recommendation, the district court must ‘make a de novo
determination of those portions of the report or specified
proposed findings or recommendations to which objection is
made.'” EEOC, 866 F.3d at 99 (quoting 28 U.S.C.
Plaintiffs' Renewed Motion for Preliminary
preliminary injunction is a drastic and extraordinary remedy
that is not to be routinely granted.” Intel Corp.
v. ULSI Sys. Tech., Inc., 995 F.2d 1566, 1568 (Fed. Cir.
1993). Although injunctions are not specific to patent cases,
under 35 U.S.C. § 283, a court may grant injunctions in
patent cases “in accordance with the principles of
equity to prevent the violation of any right secured by
patent.” To receive an injunction, a movant must
establish: (1) a reasonable likelihood of success on the
merits; (2) irreparable harm in the absence of an injunction;
(3) that the balance of equities tips in the movant's
favor; and (4) that the injunction is in the public interest.
Titan Tire Corp. v. Case New Holland, Inc., 566 F.3d
1372, 1375-76 (Fed. Cir. 2009). Although the court must
balance each of these factors before granting a motion for a
preliminary injunction, “a movant cannot be granted a
preliminary injunction unless it establishes both of the
first two factors, i.e., likelihood of success on the merits
and irreparable harm.” Amazon.com Inc. v.
Barnesandnoble.com, Inc., 239 F.3d 1343, 1350 (Fed. Cir.
2001) (citing Vehicular Techs. Corp. v. Titan Wheel
Int'l, Inc., 141 F.3d 1084, 1088 (Fed. Cir. 1998)).
their renewed motion for preliminary injunction, Plaintiffs
argued that a preliminary injunction was warranted because
(1) Plaintiffs are likely to succeed on the merits of the
case; (2) they would likely suffer irreparable harm in the
absence of an injunction; (3) equities favored the
Plaintiffs; and (4) public interest supported the injunction.
D.I. 240, at 10 (citing Titan Tire Corp, 566 F.3d at
1375-76). First, Plaintiffs argued that they are likely to
succeed on the merits of the case. Id. This argument
is primarily based upon the declarations of Dr. Edward
Borish. Id.; D.I. 16; D.I. 242. Dr. Borish conducted
a “detailed element-by-element infringement
analysis” and concluded that Defendants' products
(Matrix Bond Ultim8 Step 1 Amplifier, Redken pH-Bonder #1
Bond Protecting Additive, and L'Oréal Professional
Smartbond Step 1 Additive (the “Accused
Products”) met each element of claim 1 of the
‘419 Patent. D.I. 240.
Plaintiffs argue that they would suffer irreparable harm
should the injunction not be granted. D.I. 240, at 18.
Plaintiffs have presented the Supplemental Declaration of Dr.
Nisha Mody to support this argument. Dr. Mody stated that the
L'Oréal products which are accused of infringement