409 F.Supp.3d 912
D. Idaho2019Background
- Ice Castles (Utah LLC, owner of U.S. Patent No. 8,511,042) sued LaBelle Lake (Idaho LLC) for patent infringement after LaBelle built a competing outdoor ice attraction in Rigby, ID; pre-suit cease-and-desist letters were exchanged.
- LaBelle Lake built and operated an ice attraction using what it called “ice logs” and publicly asserted it did not infringe the ‘042 patent after consulting patent attorneys.
- Ice Castles amended its complaint to add state-law claims for defamation (including defamation per se) and intentional interference with prospective economic advantage based on LaBelle Lake’s public statements.
- LaBelle Lake moved to require Ice Castles to post a bond under Idaho’s “bad faith patent assertion” statute and separately moved to dismiss the newly-added state-law claims.
- The court dismissed the Motion for Bond without prejudice for lack of clear procedural authority in federal patent litigation to invoke Idaho Code § 48-1701 et seq., and denied the Motion to Dismiss, finding Ice Castles had plausibly pleaded the state-law claims and discovery was needed to test truth/opinion defenses.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Motion for Bond under Idaho Code § 48-1701 et seq. | Statute can be applied to curb bad-faith patent assertions and require bond. | Statute is a state-law mechanism not clearly invoked in a federal patent action; federal courts lack an established procedure to require such a bond. | Motion dismissed without prejudice for lack of clear procedural jurisdiction/authority to apply the Idaho statute in this federal case. |
| Motion to Dismiss — Defamation / Defamation per se | Complaint alleges LaBelle’s public statements harmed Ice Castles’ reputation and business, sufficient under Twombly/Iqbal. | Statements are true, non-actionable opinion, or both; LaBelle relies on extrinsic evidence. | Denied. Court finds the complaint adequately pleads defamation; truth/opinion defenses require discovery and may be resolved later. |
| Motion to Dismiss — Intentional Interference with Prospective Economic Advantage | Pleads expectancy, knowledge, intentional interference via deceit/misrepresentation, and damages. | Alleged statements were true or opinion; no wrongful means or improper purpose pleaded. | Denied. Complaint sufficiently alleges the claim; resolution depends on factual development. |
| Consideration of extrinsic evidence on 12(b)(6) motion / conversion to summary judgment | Plaintiff argues the court must not consider declarations outside the complaint without converting motion and affording discovery under Rule 56(d). | Defendant submitted a declaration asserting truth of statements; urges dismissal on its merits. | Court declined to resolve factual truth via the declaration, noted plaintiff failed to submit a Rule 56(d) declaration to delay, but nonetheless denied dismissal to allow discovery. |
Key Cases Cited
- Erie R. Co. v. Tompkins, 304 U.S. 64 (establishes that federal courts sitting in diversity apply state substantive law)
- Guaranty Trust Co. of N.Y. v. York, 326 U.S. 99 (state law cannot define federal remedies simply because federal court is available)
- United Mine Workers of Am. v. Gibbs, 383 U.S. 715 (pendent/supplemental jurisdiction principles)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (plausibility standard for pleading)
- Ashcroft v. Iqbal, 556 U.S. 662 (application of Twombly plausibility standard)
- Harris v. Amgen, Inc., 573 F.3d 728 (leave to amend generally required when dismissal under Rule 12(b)(6) is ordered)