Motion to Dismiss 1
The court granted in part and denied in part Defendant Cambridge Research & Instrumentation’s Motion to Dismiss AntiCancer, Inc.'s complaint in the Southern District of California.
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1 2 3 4 5 6 7 8 9 10 11 12 Plaintiff, 13 14 15 16 Defendant. 17 18 19 20 21 22 23 24 25 26 27 28 Presently before the Court is Cambridge Research & Instrumentation’s (“CRI”) Motion to Dismiss this Action Pursuant to Rule 12(b)(6). The sole issue before this Court is whether the action must be dismissed under the doctrine of res judicata. For the reasons set forth below, the Court HEREBY GRANTS IN PART and DENIES IN PART Plaintiff’s motion to dismiss. BACKGROUND On January 12, 2007, AntiCancer initiated an action against Cambridge Research & Instrumentations, Inc., alleging patent infringement of five different patents. (Case No. 07cv97 JLS (RBB) (“CRI I”), Doc. No. 1.) A Second Amended Complaint (“SAC”) was filed on June 27, 2007. (CRI I, Doc. No. 26.) On July 23, 2007, CRI filed its answer and counterclaims, including counterclaims of non-infringement and invalidity of each of the five patents. (CRI I, Doc. No. 30.) Magistrate Judge Brooks issued a Case Management Order in CRI I, ordering AntiCancer -19cv351
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA
ANTICANCER, INC., a California Corporation, vs. CAMBRIDGE RESEARCH & INSTRUMENTATION, INC., a Delaware Corporation,
CASE NO. 09-CV-351 JLS (RBB) ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT’S MOTION TO DISMISS (Doc. No. 15.)
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to serve a “Disclosure of Asserted Claims and Preliminary Infringement Contentions” (“PICs”) on each defendant by October 15, 2007. (CRI I, Doc. No. 49.) The PICs were served two days after its deadline and contained several deficiencies, prompting AntiCancer to move for leave to amend its PICs on November 20, 2007. (CRI I, Doc. No. 65.) Magistrate Judge Brooks held a hearing on the motion to amend on January 14, 2008. Over CRI’s objections at the hearing, Magistrate Judge Brooks gave AntiCancer permission to file a supplemental declaration to show good cause for the PICs’ defects and scheduled a second hearing. (CRI I, Doc. No. 77 (hearing transcript).) At the second hearing, held on January 31, 2008 after the supplemental document had been filed, Magistrate Judge Brooks found that AntiCancer had not sufficiently established “good cause” to amend the PICs and therefore denied leave to amend. (CRI I, Doc. Nos. 92, 88.) On February 6, 2008, this Court upheld Magistrate Judge Brooks’ Order, finding it “was not clearly erroneous or contrary to law.” (CRI I, Doc. No. 106 at 8.) Two defendants named in CRI I, NIBRI and Merck, moved for summary judgment. (CRI I, Doc. Nos. 95, 62.) On May 14, 2008, this Court granted summary judgment of noninfringement in favor of Merck and NIBRI because they were parties absent from AntiCancer’s PICs. (CRI I, Doc. No. 115.) Similarly, AntiCancer’s defective PICs contained no reference to two of the five patents, and the parties filed a joint motion dismissing those infringement claims with prejudice. (CRI I, Doc. Nos. 148, 150.) As to the remaining three patents, CRI filed motions for summary judgment of noninfringement of these patents based on the defective PICs. (CRI I, Doc. No. 139.) On February 13, 2009, this Court granted CRI’s motion for summary judgment of non-infringement as to all three patents. (CRI I, Doc. No. 214.) AntiCancer was barred from asserting any evidence other than those disclosed in the PICs in its opposition. (Id. at 7.) Accordingly, the only evidence of infringement considered by the Court were an article where CRI cited an article previously published by AntiCancer’s Dr. Hoffman and two photographs on CRI’s website. (Id.) The invalidity claims asserted by CRI remain to be adjudicated, thus the summary judgment grant was not a final judgment in CRI I. (Cf. CRI I, Doc. No. 225, making the summary judgment in favor of Merck a final judgment.) -2-
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On February 23, 2009, AntiCancer filed its complaint initiating the present action and filed a first amended complaint (“FAC”) on March 19, 2009. (Case No. 09cv351 (“CRI II”), Doc. Nos. 1, 14.) The FAC asserts patent infringement against CRI for the three patents not dismissed with prejudice and whose invalidity claims are still pending in CRI I – the ‘159, ‘384, and ‘038 patents. (CRI II, Doc. No. 14.) CRI filed the present motion to dismiss the FAC pursuant to Rule 12(b)(6) on April 2, 2009. (CRI II, Doc. No. 14.) AntiCancer filed its opposition on May 20, 2009 (CRI II, Doc. No. 16) and CRI filed its reply on May 28, 2009 (CRI II, Doc. No. 17.) The hearing date originally set for June 4, 2009 was thereafter vacated and the motion was taken under submission on its papers. LEGAL STANDARD Rule 12(b)(6) Federal Rule of Civil Procedure 12(b)(6) permits a court to dismiss a complaint for two reasons: (1) lack of a cognizable legal theory or (2) pleading of insufficient facts under an adequate theory. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990) (internal citation omitted). In reviewing a Rule 12(b)(6) motion to dismiss, the Court must assume the truth of all allegations of material fact and construe inferences in the light most favorable to the nonmoving party. Cedars-Sinai Med. Ctr. v. Nat'l League of Postmasters of the U.S., 497 F.3d 972, 975 (9th Cir. 2007). While the complaint need not contain detailed factual allegations, “a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1964–65 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). In other words, “conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss.” Associated Gen. Contractors of Am. v. Metro. Water Dist., 159 F.3d 1178, 1181 (9th Cir. 1998) (quoting Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998)). Where a motion to dismiss is granted, “leave to amend should be granted ‘unless the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. -3-
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1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). In other words, where leave to amend would be futile, the Court may deny leave to amend. See Desoto, 957 F.2d at 658; Schreiber, 806 F.2d at 1401. B. Res Judicata and Claim Splitting For general principles of res judicata, the law of the Ninth Circuit applies. Id. The Ninth Circuit applies claim preclusion where: “(1) the same parties, or their privies, were involved in the prior litigation, (2) the prior litigation involved the same claim or cause of action as the later suit, and (3) the prior litigation was terminated by a final judgment on the merits.” Cent. Delta Water Agency v. United States, 306 F.3d 938, 952 (9th Cir. 2002) (citations omitted). For principles specific to patent law, however, the law of the Federal Circuit applies. Acumed LLC v. Stryker Corp., 525 F.3d 1319, 1323 (Fed. Cir. 2008). The second requirement – the “same claim” requirement – is specific to patent law and so the law of the Federal Circuit applies. Acumed, 525 F.3d at 1323. The Federal Circuit defines a “claim” by the transactional facts from which it arises. See Foster v. Hallco Mfg. Co., Inc., 947 F.2d 469, 477 n.7 (Fed. Cir. 1991) (citing Restatement (Second) of Judgment § 24)). The third requirement – a final judgment on its merits in the prior action – does not require that the merits actually be adjudicated. See, e.g. Angel v. Bullington, 330 U.S. 183, 190 (1947) (“It is a misconception of res judicata to assume that the doctrine does not come into operation if a court has not passed on the ‘merits’ in the sense of the ultimate substantive issues of the litigation.”) However, “it must be shown that [the new claims] were included in the judgment, and that the interest of justice is not disserved by applying res judicata to claims that were never presented for adjudication.” Id. at 1556. Moreover, the related doctrine of claim splitting applies to determine whether a second action on similar claims is barred though the prior action has not been terminated by rendering a final judgment. See Adams v. State of CA Dept. of Health Servs., 487 F.3d 684, 688-89 (9th Cir. 2007). To determine if the second action is barred, the Ninth Circuit “borrow[s] from the test for claim preclusion” – “In the claim-splitting context, the appropriate inquiry is whether, assuming the first suit was already final, the second suit could be precluded pursuant to claim preclusion.” -4-
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Id. at 688 (internal citations and quotation marks omitted). DISCUSSION For the reasons stated below, the Court DENIES CRI’s motion to dismiss the patent infringement claims asserted in CRI II as they pertain to infringement actions postdating October 17, 2007 the date the defendants were served with the PICs in CRI I. As to those claims of infringement which occurred on or before October 17, 2007, the Court GRANTS CRI’s motion to dismiss, finding it is barred by the doctrine of res judicata. I. Pre-October 17, 2007 Acts of Infringement CRI contends that AntiCancer is barred from asserting any claims of infringement of the three patents claimed in CRI II under the doctrine of res judicata because “[c]laim preclusion applies to claims or causes of action, not facts.” (Reply to Opp. at 1.) In other words, CRI contends that each patent raises an independent cause of action and all facts arising from that cause of action – i.e. all acts or evidence of infringement – are subsequently barred by res judicata. The Court agrees, but, as explained infra, only up until October 17, 2007. Generally, res judicata bars claims or causes of action asserted in a second action if they arose from the same transaction in the first action. See Foster, 947 F.2d at 477 n.7. In a patent case, whether the claims are the “same” is dictated by Federal Circuit law. Acumed, 525 F.3d at 1323. The Federal Circuit has held that “one of the essential transactional facts giving rise to a patent infringement claim is ‘the structure of the device or devices in issue.’” Id. at 1324 (quoting Foster v. Hallco Mfg. Co., Inc., 947 F.2d 469, 478 (Fed. Cir. 1991)). The Federal Circuit has elaborated “that claim preclusion does not apply unless the accused device in the action before the court is ‘essentially the same’ as the accused device in a prior actions between the parties that was resolved by a judgment on the merits.” Foster, 947 F.2d at 479-80; see also Young Engineers, Inc. v. U.S. Int’l Trade Comm’n, 721 F.2d 1305, 1316 (Fed. Cir. 1983) (“With respect to patents litigation, we are unpersuaded that an ‘infringement claim,’ for purposes of claim preclusion, embraces more than the specific devices before the court in the first suit. . . . Thus, the status of an infringer is derived from the status imposed on the thing that is embraced by the asserted patent claims, the thing adjudged to be infringing. By the same token, where the alleged infringer -5-
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prevails, the accused devices have the status of noninfringements, and the defendant acquires the status of noninfringer to that extent.”) In this case, CRI contends that the devices allegedly infringed upon in CRI I are “essentially the same” as those now asserted in CRI II, and the current litigation does not “embrace[] more than the specific devices before the court in the first suit.” The Court agrees. It is undisputed that the patents claimed to be infringed in both CRI I and CRI II are the same three patents1 and that the allegedly infringing device is “CRI’s Maestro In Vivo Imaging System.” (See CRI 1, Doc. No. 26; CRI II, Doc. No. 14.) The CRI II complaint explains that the “Masetro In Vivo Imaging System” includes the following devices: the Maestro 1, Maestro 2, and Dynamic Contrast Enhancement Solution, as well as the related device, the “Nuance” camera. (CRI II, Doc. No. 14, ¶ 28.) These same devices were identified as “CRI’s Maestro imaging systems” in CRI I as the infringing devices. (Compare CRI II, Doc. No. 14-2, Ex. 4 with CRI I, Doc. No. 156-2, Ex. 4 (same document listing the Maestro 1, Mauestro 2, and Dynamic Contrast Enhancement Solution).) The “Nuance” filter camera is also included in this document which was used in support of the infringement claims in both CRI I and CRI II. (Id.) Furthermore, the “Nuance” filter camera alleged as an infringing device was the “tuneable filter” asserted as an infringement in AntiCancer’s opposition to CRI’s motion for summary judgment, which CRI included in the “Mastro” system. (See CRI I, Doc. No. 156 at 4-5.) Simply because these devices were not listed in the CRI I Complaint or PICs does not mean they were not the devices included in the “Maestro In Vivo Imaging System” which AntiCancer asserted were the infringing devices. AntiCancer’s claim, therefore, that the CRI II FAC “identifies multiple devices not listed in the CRI I complaint or PICs which CRI and its customers are using to infringe (the Maestro 2, Maestro 1, Dynamic Contract Enhancement Solution, and Nuance camera)” is disingenuous. (Opp. to MTD at 5.) Accordingly, because no new infringing devices were presented in CRI II that were not already presented in CRI I, the Court finds that these claims of infringement constitute the “same claim” for purposes of res judicata. Further, these acts of infringement satisfy the third requirement that the prior claim be CRI I included claims of infringement of two other patents, but these were dismissed with prejudice in CRI I and were not reasserted in CRI II. 9cv351 -61
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adjudicated on its merits – the Court granted summary judgment of non-infringement in favor of CRI, effectively dismissing the claims of patent infringement of the three patents at issue. See Mypoyo v. Litton Electro-Optical Systems, 430 F.3d 985, 988 (9th Cir. 2005) (“[A] summary judgment dismissal . . . is considered a decision on the merits for res judicata purposes.”); see also Hells Canyon Preservation Council v. U.S. Forest Service, 403 F.3d 683 (9th Cir. 2005) (“It is certainly true that there was a final judgment on the merits of the action in HCPC I, as the district court granted the government’s motion for summary judgment on HCPC’s NEPA claim.”) While CRI’s invalidity counter-claims are still pending, the claims of infringement of the three patents at issue reached final judgment on the merits when the court granted CRI’s motion for summary judgment of the claims of infringement asserted by AntiCancer against CRI, effectively closing the case regarding CRI’s alleged infringement in that litigation. (See CRI I, Doc. No. 214.) Thus, the Court finds that all three requirements for res judicata have been met as to the claims of infringement, but, as explained below, only as to those infringing actions which occurred on or before October 17, 2007. The Court therefore grants CRI’s motion to dismiss with prejudice all claims of infringement occurring prior to that date on the grounds of res judicata. II. Post-October 17, 2007 Acts of Infringement “[U]nder general principles of res judicata, the doctrine cannot bar plaintiffs from litigating matters that were not within the scope of the claim litigated in [the first action].” Los Angeles Branch NAACP (“LANAACP”) v. Los Angeles Unified Sch. Dist., 750 F.2d 731, 739 (9th Cir. 1984) (en banc). In LANAACP, the first action involved claims of unlawful segregative acts occurring between 1963 and the close of the trial on May 2, 1969 by stipulation of the parties. Id. A second action was subsequently filed, and the Ninth Circuit held that res judicata barred only the acts occurring prior to the close of the original trial on May 2, 1969. Id. at 739, 740-41. Accordingly, res judicata barred only those acts at issue in trial; the plaintiff was free to pursue acts occurring after May 2, 1969. Id. In its ruling in LANAACP, the Ninth Circuit rejected the argument that the scope of the litigation which was barred must extend to all segregative acts occurring prior to the date the trial court terminated the litigation in its entirety. Id. The court held that “[t]he scope of litigation is framed by the complaint at the time it is filed” and that a plaintiff has leave to file a supplemental 9cv351 -7-
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complaint to bring events outside the scope into the litigation. Id. In that case, however, the court found that the stipulation between the parties defining the scope of the litigation and the acts which were to be included operated as a supplemental pleading and refused to expand the scope of the litigation any further for purposes of res judicata. Id. at 739-40. The Supreme Court, albeit in the context of antitrust violations, has held the same: “While the 1943 judgment precludes recovery on claims arising prior to its entry, it cannot be given the effect of extinguishing claims which did not even exist and which could not possibly have been sued upon in the previous case.” Lawlor v. Nat’l Screen Serv. Corp., 349 U.S. 322, 328 (1955); accord Harkins Amusement Enterprises, Inc. v. Harry Nace Co., 890 F.2d 181, 183 (“Obviously the allegation that the defendants entered into conspiracies after the date of the Harkins I complaint was not ruled upon by the decision in Harkin I. It is elementary that new antitrust violations may be alleged after the date covered by decision or settlement of antitrust claims covering an earlier period. . . . Failure to gain relief for one period of time does not mean that the plaintiffs will necessarily fail for a different period of time . . . The defendants by winning Harkins I did not acqure immunity in perpetuity from the anti-trust laws.”) LAANACP holds that the operative complaint frames the scope of the litigation which may be barred by res judicata, unless a supplemental pleading is filed bringing in events outside the original scope. See LANAACP, 750 F.2d at 739. Here, the operative complaint is the SAC filed on June 27, 2009.2 However, AntiCancer was given until October 15, 2007 to assert its PICs in support of its claims of infringement and actually served such PICs on October 17, 2007. (See CRI I, Doc. No. 49.) PICs are expected to be complete at the time they are served to include all evidence of infringement available to the parties at that time, including the time between the filing of the complaint and the service of the PICs, unless good cause is shown for why the PICs were not complete at the time of service. (See CRI I, Doc. No. 77 at 6:2-8, 10:14-16.) Thus, as the LANAACP court construed the joint stipulation as a supplemental pleading determining the scope of the litigation, this Court construes the PICs as a supplemental pleading defining the scope of the
AntiCancer contends that the SAC was filed on June 22, 2007. The docket, however, clearly indicates that the SAC is to be considered filed on the date of the Order granting AntiCancer’s motion for leave to file the second amended complaint – June 27, 2007. (CRI I, Doc. No. 26.) 9cv351 -8-
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litigation – the scope of the alleged infringement of the three patents at issue. In this case, Magistrate Judge Brooks noted that AntiCancer’s defective PICs “were [not] the fault of belatedly discovered evidence” and that good cause must be shown for leave to amend. (Id. at 3:16-22, 5:11-12.) Magistrate Judge Brooks, however, found that AntiCancer had not sufficiently established good cause for the defective PICs and therefore, after two hearings on the matter and a supplemental declaration, denied AntiCancer’s motion for leave to amend. (CRI I, Doc Nos. 88, 92.) Accordingly, the PICs as served on October 17, 2007 are taken to include all evidence of infringement within the scope of the SAC (the operative complaint in CRI I). This Court’s grant of summary judgment of non-infringement of the three patents in favor of CRI, therefore, constitutes final adjudication on the merits of all acts or evidence of infringement prior to October 17, 2007. Thus, res judicata bars all claims of infringement on or before that date. However, those claims of infringement occurring after that date cannot be barred under general principles of res judicata because they were not, nor could they have been, within the scope of the first action. Los Angeles Branch NAACP (“LANAACP”) v. Los Angeles Unified Sch. Dist., 750 F.2d 731, 739 (9th Cir. 1984) (en banc).3 AntiCancer argues that the Court should only apply res judicata to the three pieces of evidence asserted in the defective PICs. This is not correct. This Court granted summary judgment in favor of CRI by finding that AntiCancer had not sufficiently established a genuine issue of material fact of infringement. All the Court was able to consider were the facts alleged in the PICs. This does not mean, however, that the Court granted summary judgment as to only those alleged acts of infringement; summary judgment was granted for non-infringement of the claimed patents as asserted in the Complaint, which included all alleged infringement prior to the service of the PICs, whether asserted in the PICs or not. AntiCancer cites Acumend in support of its assertion that it had not waived other acts of
This holding is consistent with case law from other circuit courts, as well. See Munoz v. Aldridge, 894 F.2d 1489, 1495 (5th Cir. 1990) (finding that plaintiff’s “individual claims in this case cannot be barred [on res judicata grounds] by his prior litigation of individual claims based on earlier, different alleged instances of discrimination”); see also Spiegel v. Continental Illinois Bank, 790 F.2d 638, 646 (7th Cir. 1986) (holding that res judicata does not bar a second action “to the extent it is based on acts which occurred after [the first action] was filed,” namely two newly discovered predicate acts of mail fraud). 9cv351 -9-
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infringement prior to the service of the PICs because it did not assert them in its initial PICs. (See Opp. to MTD at 12 - 15.) In Acumend, the district court offered plaintiff the opportunity to add additional infringement claims, which the plaintiff declined and was successful at trial. 525 F.3d at 1326-27. After trial, plaintiff filed a second infringement action against the same defendant. Id. The Federal Circuit held that res judicata did not bar the second action simply because plaintiff could have raised the allegations in the first action. Id. at 1326; see also Cromwell v. County of Sac, 94 U.S. 351, 356 (1876) (“It is not believed that there are any cases going to the extent that because in the prior action a different question from that actually determined might have arisen and been litigated, therefore such possible question is to be considered as excluded from consideration in a second action between the same parties on a different demand . . . On principle, a point not in litigation in one action cannot be recieved as conclusively settled in any subsequent actions upon a different cause, because it might have been determined in the first action.”); Hells Canyon Pres. Council v. U.S. Forest Serv., 403 F.3d 683, 686 n.2 (9th Cir. 2005).) Thus, Plaintiff argues that Acumend and Cromwell stands for the proposition that “just because AntiCancer might have been able to allege some of the claims of CRI II in the first action, no law or Rule required it to under pain of losing the right to do so forever.” (Opp. to MTD at 13.) To be sure, both Acumend and Cromwell hold that merely because a claim could have been raised, but was not, does not bar that claim from being raised in a later action. But, Acumend also applies the “essentially the same” test for what constitutes a “claim.” The “claim” is not the facts underlying that claim, such as those asserted in the PICs, but the claim itself – the claim of infringement of the patent. In fact, after rejecting defendant’s “contention that a claim is barred by claim preclusion merely because it could have been raised in a prior action between the parties that was resolved on the merits,” the Acumed court applied the “essentially the same” the test. Here, too, this Court is applying the “essentially the same” test regarding the allegedly infringing devices, finding that the claims in both CRI I and CRI II are “essentially the same.” Accordingly, though Acumend and Cromwell stand for the proposition that other devices or products or patents that could have been asserted, but were not asserted, in the first actions are not later barred by res judicata, the facts underlying those devices remain barred. That is the case here, and therefore - 10 -
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Acumend and Cromwell are inapposite.4 The Court also finds that this holding is consistent with the due process considerations inherent in barring subsequent actions on the grounds of res judicata. “When applying res judicata to bar causes of action that were not before the court in the prior action, due process of law and the interest of justice require cautious restraint.” Kearns, 94 F.3d at 1556. “[I]t is not every such case in which the policy of stopping litigation outweighs that of showing the truth.” Id. at 1557 (quoting Angel v. Bullington, 330 U.S. 183, 203 (1947)). Though CRI won on infringement grounds in CRI I, it “did not acquire immunity in perpetuity” from the patent laws. See Harkins Amusement Enterprises, 890 F.2d at 183-84 (in the context of antitrust laws); Young Engineers, 721 F.2d at 1316 (rejecting the “theory that under principles of res judicata [the defendant] became an unfettered licensee” and finding that “the legal theory that any charge of infringement based on the patent is barred [is] a clearly untenable position”). While the Court determined that CRI was a non-infringer of the patents at issue based on the allegations on or before October 17, 2007, CRI did not acquire immunity from further allegations of infringement which had not, nor could they have been, litigated in the prior action. For the reasons stated above, therefore, the Court denies CRI’s motion to dismiss the infringement claims postdating October 17, 2007.5
Similarly, the unpublished case Jumpsport, Inc. v. Hedstrom Corp., 2004 U.S. Dist. LEXIS 20382 cited by AntiCancer is distinguishable. In Jumpsport, the court granted a motion in limine excluding all non-Jumpguard products from trial and therefore only Jumpguard products were subject to the final ruling. Id. at *4-5. Jumpsport then brought a second action asserting infringement of nonJumpguard products. The court held that “[i]n light of the fact that Jumpsport did not intend to waive it claims [regarding non-Jumpguard products], and no judgment was issued on those products, res judicata cannot be said to bar this [second] lawsuit.” Id. at *6. The court went on to find that defendant also had not shown that the products were the “same cause of action” because the products were different. Id. at *7. Jumpsport, being an unpublished opinion from the Northern District of California, is not controlling. Moreover, neither of these rationales are dispositive in this case. In Jumpsport, the court find that the defendant could not claim res judicata that it claimed was not within the scope of the first trial. Id. at *9. Unlike in Jumpsport, here, the allegedly infringing products were the same products as in CRI I and a judgment was issued on those products – the judgment was not issued on the evidence underlying the infringement but on the existence of the infringement itself. In its opposition, AntiCancer points to several allegations of infringement asserted in the FAC in CRI II which post dated the filing of AntiCancer’s SAC in CRI I on June 22, 2007. (See Opp. to MTD at 20 ns.19, 21). As explained above, AntiCancer is incorrect in asserting that the filing of the SAC is the operative date because the operative date is the service of the PICs on October 17, 2007. The fact remains, however, that there are several allegations of infringement of the patents at issue in both CRI I and CRI II which postdate October 17, 2007. (See, e.g., CRI II, Doc. No. 14, ¶ 40 9cv351 - 11 5
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DATED: January 19, 2010 IT IS SO ORDERED.
CONCLUSION The Court HEREBY GRANTS IN PART and DENIES IN PART Defendant’s Motion to Dismiss this Action Pursuant to Rule 12(b)(6) on res judicata grounds. The Court DISMISSES WITH PREJUDICE all claims of infringement occurring on or before October 17, 2007 on res judicata grounds. The Court DENIES the motion as to all claims occurring after October 17, 2007.
Honorable Janis L. Sammartino United States District Judge
(CRI allegedly publishing AntiCancer’s images and data in its own patents); ¶ 60, Ex. 37 (in 2009, NCI-Frederick Small Animal Imagaing Program practices AntiCancer’s patents).) Other evidence of infringement is undated, but to the extent it is shown that these pieces of evidence could not have been asserted in the original PICs (had they not been defective), they too are not barred by principles of res judicata. 9cv351 - 12 -
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1 2 3 4 5 6 7 8 9 10 11 12 Plaintiff, 13 14 15 16 Defendant. 17 18 19 20 21 22 23 24 25 26 27 28 Presently before the Court is Cambridge Research & Instrumentation’s (“CRI”) Motion to Dismiss this Action Pursuant to Rule 12(b)(6). The sole issue before this Court is whether the action must be dismissed under the doctrine of res judicata. For the reasons set forth below, the Court HEREBY GRANTS IN PART and DENIES IN PART Plaintiff’s motion to dismiss. BACKGROUND On January 12, 2007, AntiCancer initiated an action against Cambridge Research & Instrumentations, Inc., alleging patent infringement of five different patents. (Case No. 07cv97 JLS (RBB) (“CRI I”), Doc. No. 1.) A Second Amended Complaint (“SAC”) was filed on June 27, 2007. (CRI I, Doc. No. 26.) On July 23, 2007, CRI filed its answer and counterclaims, including counterclaims of non-infringement and invalidity of each of the five patents. (CRI I, Doc. No. 30.) Magistrate Judge Brooks issued a Case Management Order in CRI I, ordering AntiCancer -19cv351
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA
ANTICANCER, INC., a California Corporation, vs. CAMBRIDGE RESEARCH & INSTRUMENTATION, INC., a Delaware Corporation,
CASE NO. 09-CV-351 JLS (RBB) ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT’S MOTION TO DISMISS (Doc. No. 15.)
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to serve a “Disclosure of Asserted Claims and Preliminary Infringement Contentions” (“PICs”) on each defendant by October 15, 2007. (CRI I, Doc. No. 49.) The PICs were served two days after its deadline and contained several deficiencies, prompting AntiCancer to move for leave to amend its PICs on November 20, 2007. (CRI I, Doc. No. 65.) Magistrate Judge Brooks held a hearing on the motion to amend on January 14, 2008. Over CRI’s objections at the hearing, Magistrate Judge Brooks gave AntiCancer permission to file a supplemental declaration to show good cause for the PICs’ defects and scheduled a second hearing. (CRI I, Doc. No. 77 (hearing transcript).) At the second hearing, held on January 31, 2008 after the supplemental document had been filed, Magistrate Judge Brooks found that AntiCancer had not sufficiently established “good cause” to amend the PICs and therefore denied leave to amend. (CRI I, Doc. Nos. 92, 88.) On February 6, 2008, this Court upheld Magistrate Judge Brooks’ Order, finding it “was not clearly erroneous or contrary to law.” (CRI I, Doc. No. 106 at 8.) Two defendants named in CRI I, NIBRI and Merck, moved for summary judgment. (CRI I, Doc. Nos. 95, 62.) On May 14, 2008, this Court granted summary judgment of noninfringement in favor of Merck and NIBRI because they were parties absent from AntiCancer’s PICs. (CRI I, Doc. No. 115.) Similarly, AntiCancer’s defective PICs contained no reference to two of the five patents, and the parties filed a joint motion dismissing those infringement claims with prejudice. (CRI I, Doc. Nos. 148, 150.) As to the remaining three patents, CRI filed motions for summary judgment of noninfringement of these patents based on the defective PICs. (CRI I, Doc. No. 139.) On February 13, 2009, this Court granted CRI’s motion for summary judgment of non-infringement as to all three patents. (CRI I, Doc. No. 214.) AntiCancer was barred from asserting any evidence other than those disclosed in the PICs in its opposition. (Id. at 7.) Accordingly, the only evidence of infringement considered by the Court were an article where CRI cited an article previously published by AntiCancer’s Dr. Hoffman and two photographs on CRI’s website. (Id.) The invalidity claims asserted by CRI remain to be adjudicated, thus the summary judgment grant was not a final judgment in CRI I. (Cf. CRI I, Doc. No. 225, making the summary judgment in favor of Merck a final judgment.) -2-
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On February 23, 2009, AntiCancer filed its complaint initiating the present action and filed a first amended complaint (“FAC”) on March 19, 2009. (Case No. 09cv351 (“CRI II”), Doc. Nos. 1, 14.) The FAC asserts patent infringement against CRI for the three patents not dismissed with prejudice and whose invalidity claims are still pending in CRI I – the ‘159, ‘384, and ‘038 patents. (CRI II, Doc. No. 14.) CRI filed the present motion to dismiss the FAC pursuant to Rule 12(b)(6) on April 2, 2009. (CRI II, Doc. No. 14.) AntiCancer filed its opposition on May 20, 2009 (CRI II, Doc. No. 16) and CRI filed its reply on May 28, 2009 (CRI II, Doc. No. 17.) The hearing date originally set for June 4, 2009 was thereafter vacated and the motion was taken under submission on its papers. LEGAL STANDARD Rule 12(b)(6) Federal Rule of Civil Procedure 12(b)(6) permits a court to dismiss a complaint for two reasons: (1) lack of a cognizable legal theory or (2) pleading of insufficient facts under an adequate theory. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990) (internal citation omitted). In reviewing a Rule 12(b)(6) motion to dismiss, the Court must assume the truth of all allegations of material fact and construe inferences in the light most favorable to the nonmoving party. Cedars-Sinai Med. Ctr. v. Nat'l League of Postmasters of the U.S., 497 F.3d 972, 975 (9th Cir. 2007). While the complaint need not contain detailed factual allegations, “a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1964–65 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). In other words, “conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss.” Associated Gen. Contractors of Am. v. Metro. Water Dist., 159 F.3d 1178, 1181 (9th Cir. 1998) (quoting Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998)). Where a motion to dismiss is granted, “leave to amend should be granted ‘unless the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. -3-
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1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). In other words, where leave to amend would be futile, the Court may deny leave to amend. See Desoto, 957 F.2d at 658; Schreiber, 806 F.2d at 1401. B. Res Judicata and Claim Splitting For general principles of res judicata, the law of the Ninth Circuit applies. Id. The Ninth Circuit applies claim preclusion where: “(1) the same parties, or their privies, were involved in the prior litigation, (2) the prior litigation involved the same claim or cause of action as the later suit, and (3) the prior litigation was terminated by a final judgment on the merits.” Cent. Delta Water Agency v. United States, 306 F.3d 938, 952 (9th Cir. 2002) (citations omitted). For principles specific to patent law, however, the law of the Federal Circuit applies. Acumed LLC v. Stryker Corp., 525 F.3d 1319, 1323 (Fed. Cir. 2008). The second requirement – the “same claim” requirement – is specific to patent law and so the law of the Federal Circuit applies. Acumed, 525 F.3d at 1323. The Federal Circuit defines a “claim” by the transactional facts from which it arises. See Foster v. Hallco Mfg. Co., Inc., 947 F.2d 469, 477 n.7 (Fed. Cir. 1991) (citing Restatement (Second) of Judgment § 24)). The third requirement – a final judgment on its merits in the prior action – does not require that the merits actually be adjudicated. See, e.g. Angel v. Bullington, 330 U.S. 183, 190 (1947) (“It is a misconception of res judicata to assume that the doctrine does not come into operation if a court has not passed on the ‘merits’ in the sense of the ultimate substantive issues of the litigation.”) However, “it must be shown that [the new claims] were included in the judgment, and that the interest of justice is not disserved by applying res judicata to claims that were never presented for adjudication.” Id. at 1556. Moreover, the related doctrine of claim splitting applies to determine whether a second action on similar claims is barred though the prior action has not been terminated by rendering a final judgment. See Adams v. State of CA Dept. of Health Servs., 487 F.3d 684, 688-89 (9th Cir. 2007). To determine if the second action is barred, the Ninth Circuit “borrow[s] from the test for claim preclusion” – “In the claim-splitting context, the appropriate inquiry is whether, assuming the first suit was already final, the second suit could be precluded pursuant to claim preclusion.” -4-
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Id. at 688 (internal citations and quotation marks omitted). DISCUSSION For the reasons stated below, the Court DENIES CRI’s motion to dismiss the patent infringement claims asserted in CRI II as they pertain to infringement actions postdating October 17, 2007 the date the defendants were served with the PICs in CRI I. As to those claims of infringement which occurred on or before October 17, 2007, the Court GRANTS CRI’s motion to dismiss, finding it is barred by the doctrine of res judicata. I. Pre-October 17, 2007 Acts of Infringement CRI contends that AntiCancer is barred from asserting any claims of infringement of the three patents claimed in CRI II under the doctrine of res judicata because “[c]laim preclusion applies to claims or causes of action, not facts.” (Reply to Opp. at 1.) In other words, CRI contends that each patent raises an independent cause of action and all facts arising from that cause of action – i.e. all acts or evidence of infringement – are subsequently barred by res judicata. The Court agrees, but, as explained infra, only up until October 17, 2007. Generally, res judicata bars claims or causes of action asserted in a second action if they arose from the same transaction in the first action. See Foster, 947 F.2d at 477 n.7. In a patent case, whether the claims are the “same” is dictated by Federal Circuit law. Acumed, 525 F.3d at 1323. The Federal Circuit has held that “one of the essential transactional facts giving rise to a patent infringement claim is ‘the structure of the device or devices in issue.’” Id. at 1324 (quoting Foster v. Hallco Mfg. Co., Inc., 947 F.2d 469, 478 (Fed. Cir. 1991)). The Federal Circuit has elaborated “that claim preclusion does not apply unless the accused device in the action before the court is ‘essentially the same’ as the accused device in a prior actions between the parties that was resolved by a judgment on the merits.” Foster, 947 F.2d at 479-80; see also Young Engineers, Inc. v. U.S. Int’l Trade Comm’n, 721 F.2d 1305, 1316 (Fed. Cir. 1983) (“With respect to patents litigation, we are unpersuaded that an ‘infringement claim,’ for purposes of claim preclusion, embraces more than the specific devices before the court in the first suit. . . . Thus, the status of an infringer is derived from the status imposed on the thing that is embraced by the asserted patent claims, the thing adjudged to be infringing. By the same token, where the alleged infringer -5-
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prevails, the accused devices have the status of noninfringements, and the defendant acquires the status of noninfringer to that extent.”) In this case, CRI contends that the devices allegedly infringed upon in CRI I are “essentially the same” as those now asserted in CRI II, and the current litigation does not “embrace[] more than the specific devices before the court in the first suit.” The Court agrees. It is undisputed that the patents claimed to be infringed in both CRI I and CRI II are the same three patents1 and that the allegedly infringing device is “CRI’s Maestro In Vivo Imaging System.” (See CRI 1, Doc. No. 26; CRI II, Doc. No. 14.) The CRI II complaint explains that the “Masetro In Vivo Imaging System” includes the following devices: the Maestro 1, Maestro 2, and Dynamic Contrast Enhancement Solution, as well as the related device, the “Nuance” camera. (CRI II, Doc. No. 14, ¶ 28.) These same devices were identified as “CRI’s Maestro imaging systems” in CRI I as the infringing devices. (Compare CRI II, Doc. No. 14-2, Ex. 4 with CRI I, Doc. No. 156-2, Ex. 4 (same document listing the Maestro 1, Mauestro 2, and Dynamic Contrast Enhancement Solution).) The “Nuance” filter camera is also included in this document which was used in support of the infringement claims in both CRI I and CRI II. (Id.) Furthermore, the “Nuance” filter camera alleged as an infringing device was the “tuneable filter” asserted as an infringement in AntiCancer’s opposition to CRI’s motion for summary judgment, which CRI included in the “Mastro” system. (See CRI I, Doc. No. 156 at 4-5.) Simply because these devices were not listed in the CRI I Complaint or PICs does not mean they were not the devices included in the “Maestro In Vivo Imaging System” which AntiCancer asserted were the infringing devices. AntiCancer’s claim, therefore, that the CRI II FAC “identifies multiple devices not listed in the CRI I complaint or PICs which CRI and its customers are using to infringe (the Maestro 2, Maestro 1, Dynamic Contract Enhancement Solution, and Nuance camera)” is disingenuous. (Opp. to MTD at 5.) Accordingly, because no new infringing devices were presented in CRI II that were not already presented in CRI I, the Court finds that these claims of infringement constitute the “same claim” for purposes of res judicata. Further, these acts of infringement satisfy the third requirement that the prior claim be CRI I included claims of infringement of two other patents, but these were dismissed with prejudice in CRI I and were not reasserted in CRI II. 9cv351 -61
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adjudicated on its merits – the Court granted summary judgment of non-infringement in favor of CRI, effectively dismissing the claims of patent infringement of the three patents at issue. See Mypoyo v. Litton Electro-Optical Systems, 430 F.3d 985, 988 (9th Cir. 2005) (“[A] summary judgment dismissal . . . is considered a decision on the merits for res judicata purposes.”); see also Hells Canyon Preservation Council v. U.S. Forest Service, 403 F.3d 683 (9th Cir. 2005) (“It is certainly true that there was a final judgment on the merits of the action in HCPC I, as the district court granted the government’s motion for summary judgment on HCPC’s NEPA claim.”) While CRI’s invalidity counter-claims are still pending, the claims of infringement of the three patents at issue reached final judgment on the merits when the court granted CRI’s motion for summary judgment of the claims of infringement asserted by AntiCancer against CRI, effectively closing the case regarding CRI’s alleged infringement in that litigation. (See CRI I, Doc. No. 214.) Thus, the Court finds that all three requirements for res judicata have been met as to the claims of infringement, but, as explained below, only as to those infringing actions which occurred on or before October 17, 2007. The Court therefore grants CRI’s motion to dismiss with prejudice all claims of infringement occurring prior to that date on the grounds of res judicata. II. Post-October 17, 2007 Acts of Infringement “[U]nder general principles of res judicata, the doctrine cannot bar plaintiffs from litigating matters that were not within the scope of the claim litigated in [the first action].” Los Angeles Branch NAACP (“LANAACP”) v. Los Angeles Unified Sch. Dist., 750 F.2d 731, 739 (9th Cir. 1984) (en banc). In LANAACP, the first action involved claims of unlawful segregative acts occurring between 1963 and the close of the trial on May 2, 1969 by stipulation of the parties. Id. A second action was subsequently filed, and the Ninth Circuit held that res judicata barred only the acts occurring prior to the close of the original trial on May 2, 1969. Id. at 739, 740-41. Accordingly, res judicata barred only those acts at issue in trial; the plaintiff was free to pursue acts occurring after May 2, 1969. Id. In its ruling in LANAACP, the Ninth Circuit rejected the argument that the scope of the litigation which was barred must extend to all segregative acts occurring prior to the date the trial court terminated the litigation in its entirety. Id. The court held that “[t]he scope of litigation is framed by the complaint at the time it is filed” and that a plaintiff has leave to file a supplemental 9cv351 -7-
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complaint to bring events outside the scope into the litigation. Id. In that case, however, the court found that the stipulation between the parties defining the scope of the litigation and the acts which were to be included operated as a supplemental pleading and refused to expand the scope of the litigation any further for purposes of res judicata. Id. at 739-40. The Supreme Court, albeit in the context of antitrust violations, has held the same: “While the 1943 judgment precludes recovery on claims arising prior to its entry, it cannot be given the effect of extinguishing claims which did not even exist and which could not possibly have been sued upon in the previous case.” Lawlor v. Nat’l Screen Serv. Corp., 349 U.S. 322, 328 (1955); accord Harkins Amusement Enterprises, Inc. v. Harry Nace Co., 890 F.2d 181, 183 (“Obviously the allegation that the defendants entered into conspiracies after the date of the Harkins I complaint was not ruled upon by the decision in Harkin I. It is elementary that new antitrust violations may be alleged after the date covered by decision or settlement of antitrust claims covering an earlier period. . . . Failure to gain relief for one period of time does not mean that the plaintiffs will necessarily fail for a different period of time . . . The defendants by winning Harkins I did not acqure immunity in perpetuity from the anti-trust laws.”) LAANACP holds that the operative complaint frames the scope of the litigation which may be barred by res judicata, unless a supplemental pleading is filed bringing in events outside the original scope. See LANAACP, 750 F.2d at 739. Here, the operative complaint is the SAC filed on June 27, 2009.2 However, AntiCancer was given until October 15, 2007 to assert its PICs in support of its claims of infringement and actually served such PICs on October 17, 2007. (See CRI I, Doc. No. 49.) PICs are expected to be complete at the time they are served to include all evidence of infringement available to the parties at that time, including the time between the filing of the complaint and the service of the PICs, unless good cause is shown for why the PICs were not complete at the time of service. (See CRI I, Doc. No. 77 at 6:2-8, 10:14-16.) Thus, as the LANAACP court construed the joint stipulation as a supplemental pleading determining the scope of the litigation, this Court construes the PICs as a supplemental pleading defining the scope of the
AntiCancer contends that the SAC was filed on June 22, 2007. The docket, however, clearly indicates that the SAC is to be considered filed on the date of the Order granting AntiCancer’s motion for leave to file the second amended complaint – June 27, 2007. (CRI I, Doc. No. 26.) 9cv351 -8-
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litigation – the scope of the alleged infringement of the three patents at issue. In this case, Magistrate Judge Brooks noted that AntiCancer’s defective PICs “were [not] the fault of belatedly discovered evidence” and that good cause must be shown for leave to amend. (Id. at 3:16-22, 5:11-12.) Magistrate Judge Brooks, however, found that AntiCancer had not sufficiently established good cause for the defective PICs and therefore, after two hearings on the matter and a supplemental declaration, denied AntiCancer’s motion for leave to amend. (CRI I, Doc Nos. 88, 92.) Accordingly, the PICs as served on October 17, 2007 are taken to include all evidence of infringement within the scope of the SAC (the operative complaint in CRI I). This Court’s grant of summary judgment of non-infringement of the three patents in favor of CRI, therefore, constitutes final adjudication on the merits of all acts or evidence of infringement prior to October 17, 2007. Thus, res judicata bars all claims of infringement on or before that date. However, those claims of infringement occurring after that date cannot be barred under general principles of res judicata because they were not, nor could they have been, within the scope of the first action. Los Angeles Branch NAACP (“LANAACP”) v. Los Angeles Unified Sch. Dist., 750 F.2d 731, 739 (9th Cir. 1984) (en banc).3 AntiCancer argues that the Court should only apply res judicata to the three pieces of evidence asserted in the defective PICs. This is not correct. This Court granted summary judgment in favor of CRI by finding that AntiCancer had not sufficiently established a genuine issue of material fact of infringement. All the Court was able to consider were the facts alleged in the PICs. This does not mean, however, that the Court granted summary judgment as to only those alleged acts of infringement; summary judgment was granted for non-infringement of the claimed patents as asserted in the Complaint, which included all alleged infringement prior to the service of the PICs, whether asserted in the PICs or not. AntiCancer cites Acumend in support of its assertion that it had not waived other acts of
This holding is consistent with case law from other circuit courts, as well. See Munoz v. Aldridge, 894 F.2d 1489, 1495 (5th Cir. 1990) (finding that plaintiff’s “individual claims in this case cannot be barred [on res judicata grounds] by his prior litigation of individual claims based on earlier, different alleged instances of discrimination”); see also Spiegel v. Continental Illinois Bank, 790 F.2d 638, 646 (7th Cir. 1986) (holding that res judicata does not bar a second action “to the extent it is based on acts which occurred after [the first action] was filed,” namely two newly discovered predicate acts of mail fraud). 9cv351 -9-
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infringement prior to the service of the PICs because it did not assert them in its initial PICs. (See Opp. to MTD at 12 - 15.) In Acumend, the district court offered plaintiff the opportunity to add additional infringement claims, which the plaintiff declined and was successful at trial. 525 F.3d at 1326-27. After trial, plaintiff filed a second infringement action against the same defendant. Id. The Federal Circuit held that res judicata did not bar the second action simply because plaintiff could have raised the allegations in the first action. Id. at 1326; see also Cromwell v. County of Sac, 94 U.S. 351, 356 (1876) (“It is not believed that there are any cases going to the extent that because in the prior action a different question from that actually determined might have arisen and been litigated, therefore such possible question is to be considered as excluded from consideration in a second action between the same parties on a different demand . . . On principle, a point not in litigation in one action cannot be recieved as conclusively settled in any subsequent actions upon a different cause, because it might have been determined in the first action.”); Hells Canyon Pres. Council v. U.S. Forest Serv., 403 F.3d 683, 686 n.2 (9th Cir. 2005).) Thus, Plaintiff argues that Acumend and Cromwell stands for the proposition that “just because AntiCancer might have been able to allege some of the claims of CRI II in the first action, no law or Rule required it to under pain of losing the right to do so forever.” (Opp. to MTD at 13.) To be sure, both Acumend and Cromwell hold that merely because a claim could have been raised, but was not, does not bar that claim from being raised in a later action. But, Acumend also applies the “essentially the same” test for what constitutes a “claim.” The “claim” is not the facts underlying that claim, such as those asserted in the PICs, but the claim itself – the claim of infringement of the patent. In fact, after rejecting defendant’s “contention that a claim is barred by claim preclusion merely because it could have been raised in a prior action between the parties that was resolved on the merits,” the Acumed court applied the “essentially the same” the test. Here, too, this Court is applying the “essentially the same” test regarding the allegedly infringing devices, finding that the claims in both CRI I and CRI II are “essentially the same.” Accordingly, though Acumend and Cromwell stand for the proposition that other devices or products or patents that could have been asserted, but were not asserted, in the first actions are not later barred by res judicata, the facts underlying those devices remain barred. That is the case here, and therefore - 10 -
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Acumend and Cromwell are inapposite.4 The Court also finds that this holding is consistent with the due process considerations inherent in barring subsequent actions on the grounds of res judicata. “When applying res judicata to bar causes of action that were not before the court in the prior action, due process of law and the interest of justice require cautious restraint.” Kearns, 94 F.3d at 1556. “[I]t is not every such case in which the policy of stopping litigation outweighs that of showing the truth.” Id. at 1557 (quoting Angel v. Bullington, 330 U.S. 183, 203 (1947)). Though CRI won on infringement grounds in CRI I, it “did not acquire immunity in perpetuity” from the patent laws. See Harkins Amusement Enterprises, 890 F.2d at 183-84 (in the context of antitrust laws); Young Engineers, 721 F.2d at 1316 (rejecting the “theory that under principles of res judicata [the defendant] became an unfettered licensee” and finding that “the legal theory that any charge of infringement based on the patent is barred [is] a clearly untenable position”). While the Court determined that CRI was a non-infringer of the patents at issue based on the allegations on or before October 17, 2007, CRI did not acquire immunity from further allegations of infringement which had not, nor could they have been, litigated in the prior action. For the reasons stated above, therefore, the Court denies CRI’s motion to dismiss the infringement claims postdating October 17, 2007.5
Similarly, the unpublished case Jumpsport, Inc. v. Hedstrom Corp., 2004 U.S. Dist. LEXIS 20382 cited by AntiCancer is distinguishable. In Jumpsport, the court granted a motion in limine excluding all non-Jumpguard products from trial and therefore only Jumpguard products were subject to the final ruling. Id. at *4-5. Jumpsport then brought a second action asserting infringement of nonJumpguard products. The court held that “[i]n light of the fact that Jumpsport did not intend to waive it claims [regarding non-Jumpguard products], and no judgment was issued on those products, res judicata cannot be said to bar this [second] lawsuit.” Id. at *6. The court went on to find that defendant also had not shown that the products were the “same cause of action” because the products were different. Id. at *7. Jumpsport, being an unpublished opinion from the Northern District of California, is not controlling. Moreover, neither of these rationales are dispositive in this case. In Jumpsport, the court find that the defendant could not claim res judicata that it claimed was not within the scope of the first trial. Id. at *9. Unlike in Jumpsport, here, the allegedly infringing products were the same products as in CRI I and a judgment was issued on those products – the judgment was not issued on the evidence underlying the infringement but on the existence of the infringement itself. In its opposition, AntiCancer points to several allegations of infringement asserted in the FAC in CRI II which post dated the filing of AntiCancer’s SAC in CRI I on June 22, 2007. (See Opp. to MTD at 20 ns.19, 21). As explained above, AntiCancer is incorrect in asserting that the filing of the SAC is the operative date because the operative date is the service of the PICs on October 17, 2007. The fact remains, however, that there are several allegations of infringement of the patents at issue in both CRI I and CRI II which postdate October 17, 2007. (See, e.g., CRI II, Doc. No. 14, ¶ 40 9cv351 - 11 5
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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DATED: January 19, 2010 IT IS SO ORDERED.
CONCLUSION The Court HEREBY GRANTS IN PART and DENIES IN PART Defendant’s Motion to Dismiss this Action Pursuant to Rule 12(b)(6) on res judicata grounds. The Court DISMISSES WITH PREJUDICE all claims of infringement occurring on or before October 17, 2007 on res judicata grounds. The Court DENIES the motion as to all claims occurring after October 17, 2007.
Honorable Janis L. Sammartino United States District Judge
(CRI allegedly publishing AntiCancer’s images and data in its own patents); ¶ 60, Ex. 37 (in 2009, NCI-Frederick Small Animal Imagaing Program practices AntiCancer’s patents).) Other evidence of infringement is undated, but to the extent it is shown that these pieces of evidence could not have been asserted in the original PICs (had they not been defective), they too are not barred by principles of res judicata. 9cv351 - 12 -
