GoDaddy.com LLC v. RPost Communications Limited, 2:14-cv-00126

Background

GoDaddy sued RPost entities seeking a declaratory judgment that certain email-tracking patents (Patents‑in‑Suit) are unenforceable for patent misuse after RPost asserted those patents against GoDaddy.
The patents were originally prosecuted by Dr. Terrance Tomkow and assigned to RPost International; later disputes arose among founders (Tomkow, Khan, Barton) over transfers and ownership.
Barton sued (the Barton Cases), alleging fraudulent transfers of RPost International assets to offshore affiliates (RMail, RComm); a state court found malice and ordered restoration of Barton’s shares.
Tomkow and Khan filed bankruptcy; Barton obtained conversion to Chapter 7 and a trustee was appointed to administer assets including the patents.
RPost threatened/enforced the patents against third parties and contacted GoDaddy claiming clear ownership and enforcement rights, without disclosing the Barton or Bankruptcy disputes; GoDaddy alleges those ownership misrepresentations amounted to patent misuse.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether misrepresenting patent ownership can constitute patent misuse	GoDaddy: misrepresentations of ownership used to enforce patents amount to patent misuse and render patents unenforceable	RPost: misuse requires impermissible broadening of patent scope (subject matter or temporal); mere ownership misrepresentation does not broaden the patent grant	Court: Dismissed — ownership misrepresentation alone does not plead the required broadening element for patent misuse
Whether bad faith allegations alone suffice for patent misuse	GoDaddy: bad faith in asserting patents supports misuse claim	RPost: bad faith is insufficient without showing broadened patent rights and anticompetitive effect	Court: Bad faith allegations without factual showing of broadened scope fail to state a misuse claim
Whether existing remedies/statutes make misuse doctrine redundant here	GoDaddy: seeks misuse to render patents unenforceable	RPost: non‑owners already lack enforcement rights under statute; fraud claims can address misrepresentation	Court: Patent misuse unnecessary/inefficient for ownership misrepresentation because unenforceability against non‑owners and other legal remedies exist
Applicability of authority cited by plaintiff (e.g., Home Gambling, IMX)	GoDaddy: these cases support that ownership misrepresentation can be misuse	RPost: those cases do not stand for that proposition or are distinguishable	Court: Found those authorities inapposite or unpersuasive for expanding misuse to ownership misrepresentation

Key Cases Cited

Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700 (Fed. Cir. 1992) (describing patent misuse as restraint arising from leveraging patent rights)
Princo Corp. v. Int'l Trade Comm'n, 616 F.3d 1318 (Fed. Cir. 2010) (refusing to extend misuse where patent rights were not broadened)
Virginia Panel Corp. v. MAC Panel Co., 133 F.3d 860 (Fed. Cir. 1997) (holding practices within patent claim scope do not constitute misuse)
C.R. Bard, Inc. v. M3 Sys., Inc., 157 F.3d 1340 (Fed. Cir. 1998) (discussing limits of misuse doctrine and rejecting open‑ended expansion based on wrongful use)
U.S. Philips Corp. v. Int'l Trade Comm'n, 424 F.3d 1179 (Fed. Cir. 2005) (stating key inquiry: whether asserting a patent impermissibly broadened its scope and caused anticompetitive effect)
Windsurfing Int'l v. AMF, Inc., 782 F.2d 995 (Fed. Cir. 1986) (articulating misuse as related to physical or temporal broadening of patent grant)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading standard: facts must plausibly suggest liability)
Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading standard requires plausible, well‑pleaded factual allegations)
Balistreri v. Pacific Police Dep't, 901 F.2d 696 (9th Cir. 1990) (Rule 12(b)(6) dismissal principles)
Daniels‑Hall v. Nat'l Educ. Ass'n, 629 F.3d 992 (9th Cir. 2010) (courts accept well‑pleaded facts and disregard conclusory allegations)