138 F. Supp. 3d 303
S.D.N.Y.2014Background
- Radiancy (plaintiff) owns U.S. Patent No. 7,170,034 ('034) for a handheld heat-based hair removal device and also owns U.S. Patent No. 6,825,445 ('445); Radiancy merged into PhotoMedex in 2011.
- Viatek (defendant/counterclaim-plaintiff) manufactures competing hair-removal products (Pearl and Samba) and was accused by Radiancy of infringing the '034 patent; Radiancy sued under 35 U.S.C. §§ 271, 281 and § 43(a) of the Lanham Act for false advertising, trade dress, trademark infringement, and unfair competition.
- Viatek asserted 21 affirmative defenses (including inequitable conduct, best mode, and unclean hands) and seven counterclaims (including declaratory judgment re: the '445 patent, Sherman Act § 2 antitrust claims, Lanham Act unfair competition, and tortious interference); Radiancy moved to strike/dismiss several defenses and counterclaims and to dismiss PhotoMedex for improper service.
- Service on PhotoMedex: Viatek served Radiancy’s counsel electronically rather than serving PhotoMedex per CPLR § 311; the court found service improper and declined to consider extra-pleading facts supporting veil-piercing.
- Pleadings deficiencies: the court applied Rule 9(b) and Rule 12(b)(6) standards (Iqbal/Twombly) and Federal Circuit precedent where patent law controlled; several defenses/counterclaims were dismissed for lack of particularity or failure as a matter of law.
Issues
| Issue | Radiancy's Argument | Viatek's Argument | Held |
|---|---|---|---|
| Service on PhotoMedex / Veil-piercing | Service on Radiancy’s counsel did not effect service on PhotoMedex; veil‑piercing not shown | Electronic service on Radiancy’s counsel sufficed; PhotoMedex is alter ego of Radiancy | Service on PhotoMedex was improper; PhotoMedex dismissed; veil‑piercing allegations insufficient under Delaware law |
| Inequitable conduct (Affirmative Defense 6) | N/A (movant arguing to strike) | Radiancy withheld/ buried prior art (e.g., U.S. Patent No. 6,307,181) and misled the PTO | Stricken: pleading fails Rule 9(b)/Exergen particularity and Therasense intent standards |
| Best mode (Affirmative Defense 7) | N/A (movant arguing to strike) | Best mode violation renders patent unenforceable / affects remedies | Stricken: AIA/Leahy‑Smith removed best mode as a basis to invalidate or cancel patents in litigation |
| Unclean hands (Affirmative Defense 21) | N/A (movant arguing to strike) | Radiancy engaged in similar misconduct (metadata use, search manipulation, false ads) | Partially denied: defense stricken except as to adequately pleaded allegations re: website metadata and Google/search conduct |
| Declaratory judgment re: '445 patent (Counterclaim 2) | N/A (movant arguing to dismiss) | There is an actual controversy because Radiancy previously asserted the '445 patent and sent demand letters | Dismissed: no present, concrete controversy—Radiancy sued only on the '034 patent and prior letters did not create continuing, immediate dispute |
| Sherman Act § 2 antitrust claims (Counterclaim 3) | Radiancy procured patents by fraud and filed sham suits to monopolize | Radiancy’s enforcement is anticompetitive and intended to monopolize hot‑wire hair removal market | Dismissed with prejudice: lack of antitrust standing, failure to plead relevant market/market power, and Rule 9(b) deficiencies for Walker Process and sham‑litigation theories |
| Lanham Act / Unfair competition (Counterclaim 4) | Radiancy’s online marketing and threats are unfair competition | Viatek asserts misappropriation (meta‑data, sponsored search, piggybacking) and bad‑faith litigation | Dismissed: failure to plead the elements (likelihood of confusion, use in commerce); Second Circuit precedent limits keyword/meta claims |
| Tortious interference (Counterclaim 5) | Radiancy’s communications to ShopNBC and others improperly interfered | Viatek alleges interference with ShopNBC relationship caused damage | Dismissed: no allegation of breach/termination of relationship, no improper means or sole malice; Viatek did not oppose dismissal |
Key Cases Cited
- Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir. 2011) (tightened scienter and materiality standards for inequitable conduct)
- Exergen Corp. v. Wal‑Mart Stores, Inc., 575 F.3d 1312 (Fed. Cir. 2009) (Rule 9(b) particularity requirements for inequitable conduct pleadings)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility pleading standard under Rule 12(b)(6))
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standard requires more than labels and conclusions)
- MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) (actual controversy standard for declaratory judgment actions)
- SanDisk Corp. v. STMicroelectronics, Inc., 480 F.3d 1372 (Fed. Cir. 2007) (when patentee’s communications create justiciable controversy for declaratory judgment)
- Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172 (1965) (antitrust liability where patent was procured by knowing and willful fraud)
- U.S. v. Bestfoods, 524 U.S. 51 (1998) (parent‑subsidiary liability and veil‑piercing principles)