Magistrate Judge Fallon recommends dismissal of plaintiff’s indirect and willful infringement claims.

Magistrate Judge Sherry R. Fallon recently recommended that the court grant defendant Staples, Inc.’s 12(b)(6) motion to dismiss claims made against it for indirect and willful infringement of U.S. Patent No. 6,216,139. Execware, LLC v. Staples, Inc., C.A. No. 11-836-LPS-SRF (D. Del. Dec. 10, 2012).
Judge Fallon first addressed plaintiff’s indirect infringement claims, which included claims of induced and contributory infringement, and noted that in order to survive a motion to dismiss, a plaintiff must (1) “adequately plead a claim for direct infringement,” and (2) “plead sufficient facts . . . for the Court to infer that the defendants had knowledge of [the plaintiff’s] patents and that their products infringed on those patents.” Id. at 4-5 (quoting Trading Techs. Int’l, Inc. v. BCG Partners, Inc., 2011 WL 43946581, at *3 (N.D. Ill. Sept. 2, 2011) (emphasis in original)). To adequately plead direct infringement, a plaintiff must provide the level of detail required by Form 18 of the Federal Rules of Civil Procedure. Id. at 4. Judge Fallon found that plaintiff failed to provide such detail. Id. at 7. Despite identifying Staples’ customers as the alleged direct infringers, the amended complaint did not “allege that Staples’ customers actually used the accused software, or that Staples caused its customers to directly infringe the ’139 patent.” Id. at 6-7. As a result, Judge Fallon recommended the dismissal of the plaintiff’s direct infringement claim. Id. at 6-8.

Judge Fallon further recommended that if the court did not adopt her recommendation regarding direct infringement, plaintiff’s indirect infringement claim should be “limited from the date of filing of the complaint.” Id. at 8. In reaching her recommendation, Judge Fallon relied on a line of District of Delaware rulings in concluding “that a plaintiff may plead actual knowledge of the patents-in-suit as of the filing of the initial complaint to state a cause of action limited to the defendant’s post-litigation conduct, and a defendant’s decision to continue its conduct despite knowledge gleaned from the complaint is sufficient to establish the intent element required to state a claim for indirect infringement.” Id. at 10 (citing Apeldyn Corp. v. Sony Corp., 852 F. Supp. 2d 568, 573-74 (D. Del. 2012); Walker Digital, LLC v. Facebook, Inc., 852 F. Supp. 2d 559, 565-66 (D. Del. 2012)). Because the plaintiff’s amended complaint alleged that Staples had knowledge of the patent only after the filing of the complaint, Judge Fallon explained that the indirect infringement claims should be limited to activity after the filing date. Id.

Turning to the plaintiff’s wilfull infringement claim, Judge Fallon noted that in order to overcome a motion to dismiss, a plaintiff must plead “facts giving rise to at least a showing of objective recklessness of the infringement risk.” Id. at 11 (quoting St. Clair Intellectual Prop. Consultants, Inc. v. Hewlett-Packard Co., 2012 WL 1134318, at *2-3 (D. Del. Mar. 28, 2012)). Judge Fallon further noted that the “Federal Circuit has held that a patentee cannot recover enhanced damages based solely on the accused infringer’s post-filing conduct when the patentee has not sought a preliminary injunction.” Id. at 12. Because the plaintiff failed to plead that Staples had “pre-suit knowledge of the ‘139 patent,” Judge Fallon recommended that the court dismiss its wilfull infringement claim. Id. at 12-13.

Execware, LLC v. Staples, Inc., C.A. No. 11-836-LPS-SRF (D. Del. Dec. 10, 2010).

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