United States District Court, D. New Jersey, Camden Vicinage
OPINION [DOC. NOS. 282, 293]
SCHNEIDER, UNITED STATES MAGISTRATE JUDGE.
case is a classic example of the mischief that occurs when a
party does not faithfully follow the requirements in the
Local Patent Rules. As will be explained in more detail, as a
result of plaintiffs' incomplete infringement
contentions, and plaintiffs' four (4) versions of their
answer to defendants' key interrogatory 7, the Court is
now unfortunately compelled to wade through the parties'
mind-numbing arguments and decide defendants' Motion to
Strike New Infringement Theories and New Invention and
Priority Dates [Doc. No. 282], and plaintiffs'
Cross-Motion to Amend [Doc. No. 393]. The Court held oral
argument on October 5 and 18, 2017, and pored over scores of
technical and contention documents to get to the bottom of
the complicated issues in dispute. For the reasons to be
discussed, the parties' motions will be granted in part
and denied in part.
filed this patent infringement action on September 23, 2015.
The patents are generally directed to software technology for
imaging, modeling and rendering aerial rooftop measurements
and reports. Plaintiffs and defendants compete in this
market. At present, seven (7) patents are at issue.
the December 9, 2015 Fed.R.Civ.P. 16 scheduling conference,
the Court's Scheduling Order mirrored the deadlines in
the Local Patent Rules. Plaintiffs served their infringement
contentions on December 23, 2015. After the Court granted
plaintiffs' motion to amend infringement contentions on
October 28, 2016 [Doc. No. 139], plaintiffs served their
first amended infringement contentions on November 4, 2016.
Not being satisfied that the contentions supplied the
necessary details required by the Local Rules, defendants
attempted on numerous occasions to try and convince
plaintiffs to serve fulsome contentions. Defendants'
efforts were unsuccessful. Justifiably not being satisfied that
plaintiffs' infringement contentions were adequate, and
that plaintiffs wrongfully insisted on taking defendants'
deposition before they complied with the Local Rules,
defendants filed their “Motion to Compel Amended
Infringement Contentions to Comply with Local Patent Rule
3.1” [Doc. No. 158] on January 27, 2017. In short,
defendants argued plaintiffs' infringement contentions
lacked required detail and specificity, they provided no
explanatory text or narrative analysis as to how or why the
accused products infringed the asserted claims, or how
plaintiffs' screenshots demonstrated the alleged
infringement required by L. Pat. R. 3.1. See
Defendants' Memorandum in Support of Motion at 1, Doc.
No. 159. Defendants argued plaintiffs simply provided
“picture books” without the textual analysis
required by the Local Rules, and required defendants to guess
at plaintiffs' infringement theories. Id. Not
surprisingly, plaintiffs disagreed and insisted their
infringement contentions complied with the Local Rules.
Plaintiffs argued, “there is no question that
Plaintiffs' contentions meet the standards of this
District's Local Patent Rules.” Plaintiffs'
Opposition at 1, Doc. No. 183.
1, 2017, the Court held oral argument on defendants'
Motion to Compel and issued its Oral Opinion. The Court
expressed its dismay at plaintiffs' position and ruled
that plaintiffs' contentions were plainly deficient.
See Transcript of May 1, 2017 Oral Argument at 42:7
- 53:1, Doc. No. 231. What was unsettling was the fact that
even though plaintiffs argued their contentions were
sufficient, plaintiffs' briefs provided explanatory text
not included in their contentions. Plaintiffs also
acknowledged source code citations were available to
supplement their contentions that they did not identify.
Thus, plaintiffs essentially acknowledged they did not
produce the fulsome infringement contentions the Local Rules
require. Id. at 51:2-20. The Court agreed. The
Court, therefore, granted defendants' Motion to Compel on
May 2, 2017, Doc. No. 213. Importantly, the Court merely
granted plaintiffs leave to “supplement” their
deficient contentions. On the same day the Court granted
defendants' motion to amend their invalidity contentions
to add the Sungevity reference as prior art. See May
2, 2017 Order, Doc. No. 212.
to comply with the May 1, 2017 Order, plaintiffs served their
amended supplemental infringement contentions on June 6,
2017. Plaintiffs also served a supplemental answer to
defendants' interrogatory 7 on July 12, 2017, and amended
the answer on July 19, 2017. Not coming as a surprise,
defendants object to plaintiffs' supplement/amendment to
their infringement contentions and July 12 and 19, 2017
answers to interrogatory 7. Defendants argue instead of
supplementing, plaintiffs amended their contentions and
required L. Pat. R. 32(b) disclosures. Defendants'
present motion argues plaintiffs cannot show good cause to
amend and seeks to strike portions of plaintiffs'
amendments. Defendants argue plaintiffs served
“entirely new substantive technical and legal
theories.” Defendants' Memorandum
(“Defts.' Memo.”) at 5-6, Doc. No. 282.
Defendants claim plaintiffs served “drastically new
substantive infringement theories that differ substantially
from those previously disclosed for a number of claim
elements.” Id. at 6.
specific objections and requested relief seeks to strike
references to the following:
• Plaintiffs' doctrine of equivalents theories;
• Plaintiffs' theories pursuant to 35 U.S.C. §
• Plaintiffs' “ground point” theory
offered in the ‘436 patent infringement contentions;
• Plaintiffs' “aerotriangulation” theory
offered in the ‘436 patent infringement contentions;
• Plaintiffs' “aerotriangulation” theory
offered in patent infringement contentions, particularly for
the “receiving an indication of a feature” and
“modifying a three-dimensional model”
• Plaintiffs' citations to Xactware source code
Bates-numbered higher than XWSC648;
• Plaintiffs' amended L. Pat. R. 3.2(b) disclosures
listed in their July 12 and 19, 2017 supplemental answers to
interrogatory 7 regarding documents and source code
evidencing conception and reduction to practice; and
• New conception and reduction to practice dates
included in plaintiffs' July 12 and 19, 2017 answers to
Cross-Motion to Amend seeks leave of court to assert the
foregoing matters in the event the Court deems leave is
as the general status of the case is concerned, the
Markman hearing was recently held and the parties
are awaiting the ruling. The fact discovery deadline expires
on December 28, 2017, and no expert reports have been
produced. No trial date has been set.
May 1, 2017 Ruling
plaintiffs mis-read the Court's May 1, 2017 ruling and
accompanying May 2, 2017 Order, the Court's analysis
starts with what it did and did not Order. To the extent
plaintiffs assume the Court granted them carte
blanche to amend their infringement contentions they are
dead wrong. Plaintiffs were only granted leave to supplement
their contentions to comply with the Local Rules. Plaintiffs
are well aware that in order to amend contentions a motion to
amend must be filed. Horizon Pharma AG v. Watson
Laboratories, Inc. - Florida, C.A. No. 13-5124 (JEI/JS),
2015 WL 12850575, at *2 (D.N.J. Feb. 24, 2015)(“New
Jersey L. Pat. R. 3.7 provides that contentions may only be
amended upon Order of the Court ‘upon a timely
application and showing of good cause.'”) The Court
did not dispense with Local Rule 3.7. Instead, the Court
directed plaintiffs to comply with the Local Rules requiring
fulsome contentions. The Court could not have granted
plaintiffs carte blanche to amend because it did not
have a record on which to determine if good cause existed.
plaintiffs seem to argue, they were free to amend their
contentions at their leisure, it would minimize the mandatory
nature of the Local Rules. If the Court accepted
plaintiffs' argument plaintiffs could amend without good
cause simply by serving deficient infringement contentions
and waiting for their adversary to ask for a supplement. This
is unacceptable. The Court agrees with defendants that what
the Court directed at the May 1, 2017 hearing and in its May
2, 2017 Order was that plaintiffs “would supplement
their contentions to provide additional information and
detail, not add entirely new theories of infringement.”
Defendants' Reply (“Defts.' Reply”) 5-6,
Doc. No. 298 (emphasis removed). See also Tr. at
52:12-13 (“We'll give plaintiffs a reasonable time
to supplement their contentions. [Plaintiffs will] rise or
fall with them.”)
made it clear that plaintiffs were only granted leave to
supplement but not amend their infringement contentions, the
Court must decide into what category plaintiffs' changes
fit. Admittedly, the line is not always clear. However,
supplementary disclosures “do not permit a party to
introduce new opinions after the disclosure deadline under
the guise of a supplement.” Medtronic Inc. v.
Edwards Lifesciences Corp., Case No. SACV 12-00327-JFV
(MLGx), 2013 WL 12131746, at *2 (C.D. Ca. July 24,
2013)(citation and quotation omitted). Claims and issues
which should have been included in plaintiffs' original
contentions may not be added under the guise of a supplement.
See Plumley v. Mockett, 836 F.Supp.2d 1053, 1062
(C.D. Ca. 2010).
Court determines plaintiffs merely supplemented their
contentions, defendants' motion will be denied because
plaintiffs will be in compliance with the Court's Order.
If the Court decides plaintiffs amended rather than
supplemented their contentions, the Court must then decide
whether plaintiffs show good cause for the amendment. If good
cause does not exist, plaintiffs' Motion to Strike will
be granted and defendants' Cross-Motion to Amend will be
standard to establish good cause to amend is well
established. The key factor courts look at is the diligence
of the moving party. O2 Micro Intern. Ltd. v. Monolithic
Power Sys., Inc., 467 F.3d 1355, 1366 (Fed.
Cir. 2006). Diligence has two aspects to it. One is whether
the moving party acted diligently to discover that an
amendment was appropriate. The second aspect is whether the
moving party promptly moved to amend its contentions after it
learned an amendment was necessary. See generally
id.; AS America, Inc. v. Masco Corp. of
Indiana, C.A. No. 13-05 (JBS/JS), 2013 WL 4084237, at *2
(D.N.J. Aug. 13, 2013). Other factors courts consider to
determine whether good cause exists to grant an amendment
are: (1) the reason for the delay, including whether it was
within the reasonable control of the party responsible for
it; (2) the importance of what is to be excluded; (3) the
danger of unfair prejudice; and (4) the availability of a
continuance and the potential impact of a delay on judicial
proceedings. LMT Mercer Group, Inc. v. Maine Ornamental,
LLC, C.A. Nos. 10-4615, 10-6699 (FLW), 2014 WL 2842338,
at *6 (D.N.J. Jan. 24, 2014); see also Oyajt Ltd. v.
Vatech Amer., Inc., C.A. No. 10-4875 (PGS/DEA), 2012 WL
1067900, at *20 (D.N.J. March 29, 2012). Only if the court
finds diligence does it need to determine if the non-party
would suffer prejudice as a result of an amendment. LMT
Mercer Group, at *6.
Court will separately address each of defendants'
Doctrine of Equivalents Theories
R. 3.1(e) requires a plaintiff to identify whether a
limitation is asserted to be met literally or under the
doctrine of equivalents (hereinafter “DOE”),
“[n]ot later than 14 days after the Initial Scheduling
Conference.” Defendants argue plaintiffs' December
23, 2015 contentions and November 4, 2016 amended contentions
did not contain any DOE contentions. According to defendants,
plaintiffs did not add their DOE theory until their second
amended contentions on June 6, 2017. Plaintiffs added
allegations regarding DOE for only two specific claim
requirements. The “memory” and “roof
estimation module” references in claim 1 of the
‘436 Patent and claim 10 of the ‘840 Patent.
Defendants ask the Court to strike these contentions because
plaintiffs cannot show good cause to amend. Specifically,
defendants argue plaintiffs did not act diligently and they
will be prejudiced by the amendment.
respond by pointing out their November 4, 2016 amended
contentions stated, “Xactware has directly infringed
and continues to directly infringe, either literally or under
the doctrine of equivalents claims … of the ‘436
Patent[.]” See Exhibit 1 at
In addition, plaintiffs' L. Pat. R. 3.1(c) chart reserved
the right to supplement plaintiffs' contentions as to the
DOE. See Exhibit 4 (“Plaintiffs further
reserve the right to supplement these contentions as to the
Doctrine of Equivalents[.]”)
response to plaintiffs' arguments defendants counter that
plaintiffs never articulated any DOE theory for any
limitation of any asserted claim for any patent. And,
therefore, plaintiffs' new DOE theories are entirely new.
Defts' Reply at 8. ...