950 F. Supp. 2d 876
E.D. Va.2013Background
- Rembrandt Social Media, LP sues Facebook, Inc. and AddThis, Inc. for infringement of the '316 and '362 patents, with the '362 patent claim 7 at issue (a system claim).
- Rembrandt alleges Facebook directly infringing the '316 patent and indirectly infringing the '316 patent, and that Facebook and AddThis jointly infringe and that AddThis directly infringes the '362 system claim; Facebook allegedly directly infringes the '362 system claim as well.
- Rembrandt contends Facebook had pre-suit knowledge of the patents from four sources, and that post-suit knowledge can support indirect infringement, with damages limited to post-filing periods.
- Defendants move to dismiss for failure to plead pre-suit knowledge and to limit indirect infringement damages to post-filing period, and argue the system claim can only be infringed by the end user consumer, not the defendants.
- The court concludes: pre-suit knowledge for indirect infringement is not pleaded plausibly; post-suit knowledge supports indirect infringement damages from the filing date forward; pre-suit knowledge is insufficient for willful infringement; Rembrandt adequately pleads direct infringement of the '362 claim 7 by Facebook and AddThis.
- The court grants in part and denies in part: dismisses willful infringement; limits indirect infringement damages to post-filing period; and denies dismissal of the direct infringement claim 7.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Pre-suit knowledge for indirect infringement plausibility | Rembrandt argues pre-suit knowledge can be pled via shared law firm, patents citing the '362 patent, and patent purchases. | Facebook contends the pleaded facts do not plausibly show pre-suit knowledge of the patents. | Pre-suit knowledge for indirect infringement insufficiently pled. |
| Post-suit knowledge sufficiency for indirect infringement | Knowledge obtained from service or filing of suit supports indirect infringement. | Post-suit knowledge alone should be adequate for indirect infringement in light of pleading; or not? | Post-filing knowledge adequately pleads indirect infringement, with damages limited to post-filing period. |
| Willful infringement pleading and knowledge | Willful infringement based on post-suit knowledge may be possible. | Willful infringement must be grounded in presuit knowledge; post-suit knowledge cannot sustain willfulness. | Willful infringement dismissed; presuit knowledge required. |
| Direct infringement of the '362 system claim 7 | Facebook and AddThis place into use all elements of the claim 7 system; they directly infringe. | Centillion limits should apply; the consumer/end-user action may be required for direct infringement of a system claim. | Rembrandt adequately pleads direct infringement of claim 7; both Facebook and AddThis may directly infringe. |
| Damages timing for indirect infringement | Damages for indirect infringement should cover the entire period of infringement. | Damages for indirect infringement should commence with knowledge and post-filing period. | Indirect infringement damages limited to post-service of the complaint. |
Key Cases Cited
- Centillion Data Sys., LLC v. Qwest Comm’ns. Int’l, Inc., 631 F.3d 1279 (Fed. Cir. 2011) (use of system requires placing into service or placing all elements into use)
- In re Seagate Tech., LLC, 497 F.3d 1369 (Fed. Cir. 2007) (willful infringement standard; knowledge of infringement and patent necessity)
- Beatrice Foods Co. v. New England Printing & Lithographing Co., 923 F.2d 1576 (Fed. Cir. 1991) (enhancement of damages premised on willful infringement)
- Jurgens v. CBK, Ltd., 80 F.3d 1566 (Fed. Cir. 1996) (willful infringement requires some degree of culpability)
- Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 755 (U.S. 2011) (knowledge of existence of the patent required for inducement and contributory infringement)
- Aro Mfg. Co. v. Convertible Top Replacement Co., 377 U.S. 476 (U.S. 1964) (knowledge requirement for contributory infringement)
- NTP, Inc. v. Research in Motion, Ltd., 418 F.3d 1295 (Fed. Cir. 2005) (direct infringement and use of system principles)