Surfacesupplied, Inc v. Kirby Morgan Dive Systems, Inc
3:13-cv-00575
N.D. Cal.Oct 3, 2013Background
- Kirby Morgan moves to dismiss SSI's second and third counterclaims and strike all 21 affirmative defenses.
- SSI alleges trademark infringement defenses and seeks declarations of non-infringement and misuses of Kirby Morgan marks.
- SSI's affirmative defenses include numerous legal conclusions; Kirby Morgan argues they lack factual support under Iqbal–Twombly.
- Court evaluates pleading sufficiency, validity of certain defenses, and potential futility of amendment.
- Court dismisses SSI's second and third counterclaims with leave to amend; strikes several affirmative defenses; and grants other defenses with varying leave.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are SSI's affirmative defenses adequately pled? | SSI concedes need to amend under Iqbal–Twombly. | Many defenses are legally defective and should be stricken. | Yes, several defenses stricken; remaining defenses may be amended. |
| Should specific defenses (First, Eighteenth, Twenty-First) be stricken as improper or futile? | Defense labels improperly plead claims or reserve rights improperly. | Some defenses could be amended to cure pleading deficiencies. | First, eighteenth (no damages) and twenty-first defenses stricken; remaining with leave to amend. |
| Do SSI's counterclaims for attempted monopolization and monopolization meet pleading standards? | SSI alleges pattern of sham litigation and market power. | Allegations are conclusory and fail elements of predatory conduct, specific intent, and dangerous probability. | Dismissed with leave to amend for both counterclaims. |
| Are the Noerr-Pennington defenses applicable to SSI’s counterclaims? | SSI asserts sham litigation policy under Noerr-Pennington. | Two lawsuits insufficient to prove a policy; need more baseless or numerous suits. | Noerr-Pennington dismissal; need amend to cure pleading deficiencies with proof of sham litigation. |
Key Cases Cited
- Balistreri v. Pacifica Police Dept., 901 F.2d 696 (9th Cir. 1990) (standard for Rule 12(b)(6) dismissal and plausibility)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (Supreme Court 2007) (plausibility standard; not merely conclusory allegations)
- Ashcroft v. Iqbal, 556 U.S. 662 (Supreme Court 2009) (plausibility review; conclusory statements insufficient)
- Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542 (9th Cir. 1990) (case law on considering documents in Rule 12(b)(6) context)
- Branch v. Tunnell, 14 F.3d 449 (9th Cir. 1994) (documents incorporated by reference may be considered)
- Parrino v. FHP, Inc., 146 F.3d 699 (9th Cir. 1998) (judicial notice and reliance on undisputed documents)
- Mack v. S. Bay Beer Distribs., Inc., 798 F.2d 1279 (9th Cir. 1986) (integrates judicial notice in pleading standards)
- JPMorgan Chase Bank, N.A. v. Parkside Lending, LLC, 2013 U.S. Dist. LEXIS 16981 (N.D. Cal. 2013) (damages defense not an affirmative defense; pleading standards)
- Kottle v. Nw. Kidney Centers, 146 F.3d 1050 (9th Cir. 1998) (series-of-lawsuits test for Noerr-Pennington sham litigation)
- Park ‘N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189 (Supreme Court 1985) (descriptiveness; incontestable marks limitations)