Patent Litigators: Be Careful What You Plead

Last month, in a sua sponte Memorandum Order in Technology Licensing Corp. v. Pelco, Inc., 11-cv-8544 (N.D. Ill. Mar. 5, 2012), Senior U.S. District Court Judge Milton I. Shadur recently took defendant to task for its answer and counterclaim.

In paragraphs 3, 5 and 6 of its answer defendant pled the boilerplate language that it was without knowledge or information sufficient to form a belief about the truth of the allegations of paragraph [ ] and therefore denies those allegations.” Judge Shadur rebuked defendant for this latter clause, stating it was “oxymoronic” that a party could assert in good faith that it did not have enough information to form a belief about an allegation, and then proceed to deny it.

The court also took issue with defendant’s affirmative defenses (“AD”) to the complaint. As to AD 1, which asserted noninfringement, the court criticized the response as violating the nature of an AD — accepting all of the allegations of the complaint — but then explaining why it was nevertheless not liable. The court outright struck AD 2, which asserted invalidity as directly at odds with §§ 7 and 8 of the complaint, which alleged direct and indirect infringement by defendants. As to AD 3, the court criticized it as “an impermissible laundry list that gives no clue as to the grounds for any of the contentions set out there.” The court noted that under the Federal Rules, notice pleading is required of defendants as well as plaintiffs, and so struck AD 3 without prejudice.

Finally, as to the declaratory judgment counterclaims, defendant asserted counterclaims of non-infringement and invalidity, citing 28 U.S.C. § 2201 et seq., the Federal Declaratory Judgment Act, for the former. Here the court requested that defendant provide “a brief explanation . . . of the reason that patent infringement cases so often spawn counterclaims seeking declaratory judgments–counterclaims that are nothing more than the flipside of the complaints involved,” noting that “the practice cannot stem from any requirement in 35 U.S.C. §285, which [defendant’s] counsel cite as supporting part of the relief sought, for that provision permits the award of fees to the ‘prevailing party’ without reference to which side of the ‘v.’ sign that party occupies.

The decision there is consistent with other recent district court orders, such as Ferring v. Watson Labs, where the District of Nevada Court held the affirmative defense of invalidity was insufficiently pled; GemcoII LLC v. Electroimpact Inc., where the District of Kansas Court dismissed the counterclaims of invalidity and patent misuse as inadequate; and Armstrong Pump Inc. v. Hartman et al., where the Western District of New York Court dismissed counterclaims of patentability and invalidity for lacking adequate factual support.

The takeaway from all these cases is that practitioners on both sides of the “v.” must pay careful attention to the adequacy and sufficiency of their respective pleadings.