1 2
3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE
9 10 CEMCO, LLC, CASE NO. C23-0918JLR 11 Plaintiff, ORDER v. 12 KPSI INNOVATIONS, INC., et al., 13 Defendants. 14
15 I. INTRODUCTION 16 Before the court is Defendants KPSI Innovations, Inc. (“KPSI”), James Klein 17 (“Mr. Klein”), Serina Klein, and Kevin Klein’s (collectively, “Defendants”) motion to 18 dismiss Plaintiff CEMCO, LLC’s (“CEMCO”) second amended complaint. (Mot. (Dkt. 19 # 54); Reply (Dkt. # 61); see also 2d Am. Compl. (Dkt. # 52).) CEMCO opposes the 20 motion. (Resp. (Dkt. # 57).) The court has considered the parties’ submissions, the 21 //
22 // 1 relevant portions of the record, and the governing law. Being fully advised,1 the court 2 DENIES in part, RESERVES RULING in part, and ORDERS supplemental briefing on
3 Defendants’ motion. 4 II. BACKGROUND 5 A. Factual Background 6 CEMCO owns United States Patent Nos. 7,681,365 (’365 Patent (Dkt. # 1-1)), 7 7,814,718 (’718 Patent (Dkt. # 1-2)), 8,136,314 (’314 Patent (Dkt. # 1-3), and 8,151,526 8 (’526 Patent (Dkt. # 1-4)) (collectively, the “Asserted Patents”). (2d Am. Compl. ¶ 10.)
9 The Asserted Patents “generally claim head-of-wall products that comprise an 10 intumescent strip . . . affixed on a sidewall of a header, wherein the intumescent strip 11 expands in a fire to seal the gap between the header and the ceiling to inhibit the spread 12 of smoke and fire.” (Id. ¶ 11; see also ’365 Patent at 6:42-8:29; ’718 Patent at 13 10:9-12:22; ’314 Patent at 10:20-65; ’526 Patent at 7:32-8:46.)
14 Mr. Klein is the sole named inventor on each of the Asserted Patents. (See 15 generally Asserted Patents.) He is also a former CEMCO employee. (2d Am. Compl. 16 ¶ 24.) A series of lawsuits and settlements involving CEMCO and its affiliates, Mr. 17 Klein and his businesses, and Ohio-based nonparty Clarkwestern Dietrich Building 18 Systems LLC (“ClarkDietrich”) resulted in Mr. Klein and his companies “g[iving] up the
19 right to make, use, offer for sale, or sell any product covered by the [Asserted] Patents” 20 //
21 1 The parties request oral argument. (See Mot. at 1; Resp. at 1.) The court, however, concludes that oral argument would not be helpful to its disposition of the motion. See Local 22 Rules W.D. Wash. LCR 7(b)(4). 1 and “ClarkDietrich bec[oming] the exclusive licensee of the [Asserted] Patents.” (Id. 2 ¶ 30; see also id. ¶¶ 24-50 (describing four prior lawsuits).)
3 The court expanded upon the parties’ “thorny history” in a prior order. (See 4 10/31/23 Order (Dkt. ## 46 (sealed), 48 (redacted)) at 3-6.) Here, it suffices to say that 5 KPSI is the latest entity with ties to Mr. Klein that CEMCO asserts is infringing its 6 patents. Although ClarkDietrich has participated in several of the prior lawsuits (see id.), 7 it is not a party to this case. 8 B. Procedural History
9 CEMCO filed its second amended complaint in response to the court’s October 10 31, 2023 order granting in part Defendants’ motion to dismiss. (See generally 10/31/23 11 Order.) In that order, the court determined that CEMCO had both statutory and Article 12 III standing to bring this suit and that ClarkDietrich, as CEMCO’s exclusive licensee to 13 the Asserted Patents, was a necessary party to this action. (Id. at 7-17.) Accordingly, the
14 court dismissed the patent allegations in CEMCO’s complaint with leave to add 15 ClarkDietrich as a co-plaintiff. (Id. at 18.) CEMCO contacted ClarkDietrich and 16 discussed adding the company as a co-plaintiff (11/10/23 Trojan Decl. (Dkt. # 50) ¶ 2), 17 but ClarkDietrich ultimately refused to voluntarily join this lawsuit (see 2d Am. Compl. 18 ¶ 22).
19 Defendants subsequently filed the pending motion to dismiss, arguing that, 20 pursuant to Federal Rule of Civil Procedure (“Rule”) 12(b)(7), CEMCO’s complaint must 21 be dismissed for failure to join ClarkDietrich. (Mot. at 1-5.) Defendants alternatively 22 // 1 argue that CEMCO’s complaint fails to state a claim upon which relief can be granted 2 pursuant to Rule 12(b)(6). (Id. at 5-12.)
3 III. ANALYSIS 4 When determining whether to dismiss a complaint under Rule 12(b)(6) or Rule 5 12(b)(7), the court must accept factual allegations in the complaint as true. See 6 Paiute-Shoshone Indians of Bishop Cmty. of the Bishop Colony, Cal. v. City of Los 7 Angeles, 637 F.3d 993, 996 n.1 (9th Cir. 2011). Under Rule 12(b)(7), the court may also 8 consider extrinsic materials attached to the motion. See McShan v. Sherrill, 283 F.2d
9 462, 464 (9th Cir. 1960). The court first considers Defendants’ arguments concerning 10 joinder before considering whether CEMCO has failed to state a claim. 11 A. Rule 12(b)(7) 12 A district court may dismiss a plaintiff’s complaint pursuant to Rule 12(b)(7) for 13 “failure to join a party under Rule 19.” Fed. R. Civ. P. 12(b)(7). The court performs a
14 three-step analysis to determine whether dismissal under Rule 19 is appropriate. First, 15 the court must determine whether the absent party is “necessary” pursuant to Rule 19(a). 16 See Dine Citizens Against Ruining Our Env’t v. Bureau of Indian Affs., 932 F.3d 843, 851 17 (9th Cir. 2019). If the absent party is necessary, the court must determine whether 18 joinder of that party is “feasible.” E.E.O.C. v. Peabody W. Coal Co., 400 F.3d 774, 779
19 (9th Cir. 2005). If joinder is not feasible, the court must then determine whether the 20 absent party is “indispensable” pursuant to Rule 19(b). Id. If the court reaches the final 21 step and concludes that the absent party is indispensable, the complaint must be 22 dismissed. See Fed. R. Civ. P. 19(b). 1 Because the court has already determined that ClarkDietrich is a necessary party 2 under Rule 19(a)(1)(B) (10/31/23 Order at 16-17), the court begins its analysis at the
3 second step by considering whether it is “feasible” to join ClarkDietrich in this matter. 4 1. Feasibility of Joinder 5 For joinder of a necessary party to be feasible, venue must be proper, the absent 6 party must be subject to the court’s personal jurisdiction, and joinder must not destroy 7 subject matter jurisdiction. See Peabody W. Coal, 400 F.3d at 779. If joinder is in fact 8 feasible, “the court must order the necessary individual to be made party to the action.”
9 Rasmussen v. Garrett, 489 F. Supp. 3d 1131, 1151 (D. Or. 2020) (citing Fed. R. Civ. P. 10 19(b)). Defendants argue that joinder of ClarkDietrich is feasible (Mot. at 3-5), but 11 CEMCO argues that it is not (Resp. at 7).2 The court agrees with CEMCO. 12 Here, venue is proper under 28 U.S.C. § 1400(b) because Defendants reside in this 13 District (Mot. at 4; see 8/16/23 S. Klein Decl. (Dkt. #27-1) ¶¶ 1-5), and the court has
14 subject matter jurisdiction pursuant to 28 U.S.C. § 1338(a) (patent infringement) and 28 15 U.S.C. § 1367(a) (supplemental jurisdiction). But the evidence establishes that this court 16 lacks personal jurisdiction over ClarkDietrich. (See generally Dkt.) The court lacks 17 //
18 2 The parties’ positions are perplexing. If the district court concludes that joinder is feasible, it orders the necessary nonparty to join the action so that it may proceed. See, e.g., 19 Overpeck v. FedEx Corp., No. 18-cv-07553-PJH, 2020 WL 1557433, at *6-7 (N.D. Cal. Apr. 1, 2020) (holding joinder of nonparties feasible and directing the clerk to issue summons ordering 20 those parties to appear). As such, defendants seeking dismissal under Rule 19 generally argue that joinder is not feasible. E.g., Ling Tie v. Peng Chan, No. CV 14-01211 BRO (RZx), 2010 WL 10930695, at *6 (C.D. Cal. Dec. 12, 2010) (“As the moving parties, [the defendants] bear 21 the burden of demonstrating that [the nonparty] is a necessary party, that his joinder is not feasible, and that he is indispensable such that the FAC must be dismissed.”). Nevertheless, the 22 court considers the parties’ arguments as presented. 1 general jurisdiction over ClarkDietrich, which is an Ohio-based company having no 2 facilities, property, or accounts in Washington. (See 12/22/23 Trojan Decl. (Dkt. # 58)
3 ¶ 2, Ex. 1 (“ClarkDietrich PJ Letter”) (letter from ClarkDietrich’s attorney explaining 4 why this court lacks personal jurisdiction over ClarkDietrich)); see also Freestream 5 Aircraft (Berm.) Ltd. v. Aero Law Grp., 905 F.3d 597, 602 n.2 (9th Cir. 2018) (explaining 6 that general jurisdiction requires a person’s “contacts with the forum state [to be] so 7 ‘continuous and systematic’ as to render [them] essentially ‘at home’ in that forum.” 8 (quoting Daimler AG v. Bauman, 571 U.S. 117, 139 (2014))). Moreover, specific
9 jurisdiction does not exist because ClarkDietrich’s contacts with Washington are 10 unrelated to the subject matter of this lawsuit. (See generally 2d Am. Compl. See 11 ClarkDietrich PJ Letter.) This lawsuit arises out of KPSI’s alleged infringement of 12 CEMCO’s patents; it neither “relate[s] to” nor “arises out of” ClarkDietrich’s activities in 13 Washington. See Helicopteros Nacionales de Colom., S.A. v. Hall, 466 U.S. 408, 414
14 (1984) (quoting Shaffer v. Heitner, 433 U.S. 186, 204 (1997)). 15 Defendants present no evidence to the contrary and instead argue that the court 16 “previously concluded that it would indeed be feasible to join ClarkDietrich” and would 17 “plainly . . . have personal jurisdiction over ClarkDietrich if ClarkDietrich were to join as 18 a plaintiff here.” (Mot. at 3-4.) Defendants misstate the court’s prior order and
19 misunderstand the law. The court previously concluded that joinder “appear[ed]” 20 feasible and noted that there were no facts before it at the time suggesting that 21 ClarkDietrich would not be subject to this court’s personal jurisdiction. (10/31/23 Order 22 at 17-18.) Such facts are now before the court. (See ClarkDietrich PJ Letter; see also 1 Reply at 8-9.) Defendants’ second argument fairs no better. If ClarkDietrich “were to 2 join” this matter, that would constitute a voluntary waiver of personal jurisdiction by
3 ClarkDietrich altogether. See De Fontbrune v. Wofsy, 39 F.4th 1214, 1228-29 (9th Cir. 4 2022); (see also Reply at 9 n.8 (agreeing that “personal jurisdiction over ClarkDietrich 5 presents no problem if ClarkDietrich joins voluntarily”)). But ClarkDietrich will not 6 appear voluntarily (see ClarkDietrich PJ Letter), and the court lacks the requisite personal 7 jurisdiction over ClarkDietrich to compel it to appear. The court must therefore 8 determine whether ClarkDietrich is “indispensable,” that is, whether this action may
9 proceed in its absence. 10 2. Indispensable Party 11 To determine whether a party is indispensable, “the court must determine whether, 12 in equity and good conscience, the action should proceed among the existing parties.” 13 Fed. R. Civ. P. 19(b). To do so, the court considers the following factors: (1) “the extent
14 to which a judgment rendered in the person’s absence might prejudice that person or the 15 existing parties”; (2) “the extent to which any prejudice could be lessened or avoided”; 16 (3) “whether a judgment rendered in the person’s absence would be adequate”; and (4) 17 “whether the plaintiff would have an adequate remedy if the action were dismissed for 18 nonjoinder.” Fed. R. Civ. P. 19(b)(1)-(4); see Klamath Irrigation Dist. v. U.S. Bureau of
19 Reclamation, 48 F.4th 934, 947 (9th Cir. 2022). The burden is on the defendant to show 20 that the nonparty is indispensable. See Clinton v. Babbitt, 180 F.3d 1081, 1088 (9th Cir. 21 1999); see also Ferm v. Crown Equity Holdings, Inc., No. 2:10-cv-02075-GMN, 2011 22 // 1 WL 3300210, at *2 (D. Nev. Aug. 1, 2011) (“It is Defendants’ burden to show that [the 2 nonparty] is an indispensable party . . . .”). The court considers each factor in turn.
3 i. Factor 1: Prejudice 4 The first factor concerns potential prejudice to ClarkDietrich and the parties. See 5 Fed. R. Civ. P. 19(b)(1). Defendants make two relevant arguments, one concerning 6 prejudice to ClarkDietrich and one concerning prejudice to themselves; neither is 7 sufficient to warrant weighing this factor in their favor. 8 First, Defendants argue that “ClarkDietrich’s [exclusive] rights to make and sell
9 products are at risk in this lawsuit,” presumably because the Asserted Patents are at risk 10 of being ruled invalid. (Mot. at 2.) But even if a party is necessary under Rule 19(a) 11 “because it would be prejudiced by a holding of invalidity of its patent, this prejudice 12 does not automatically make [that party] indispensable.” Dainippon Screen Mfg. Co. v. 13 CFMT, Inc., 142 F.3d 1266, 1272 (Fed. Cir. 1998). This is because prejudice can be
14 “mitigated when the interests of [the absent] party are ‘adequately protected by those who 15 are present.’” Id. (quoting In re Allustiarte, 786 F2d 910, 919 (9th Cir. 1986)). CEMCO 16 and ClarkDietrich share the “common goal” of assuring that the Asserted Patents are 17 neither held invalid nor infringed, and they have previously “jointly sought legal 18 assistance in furtherance of that goal.” Id.; (see also 10/31/23 Order at 4 (describing a
19 lawsuit in which CEMCO and ClarkDietrich sued Mr. Klein for infringement of the 20 Asserted Patents)). Moreover, CEMCO has proven its ability to protect and enforce the 21 Asserted Patents on its own, having already won a jury trial involving the Asserted 22 // 1 Patents against one of Mr. Klein’s other entities, Seal4Safti, Inc. (“S4S”), in 2 ClarkDietrich’s absence. (See 10/31/23 Order at 4-5.)
3 Second, Defendants argue, and the court previously indicated, that they are “at risk 4 of incurring multiple or otherwise inconsistent obligations.” (Mot. at 2; 10/31/23 Order 5 at 16-17.) CEMCO counters, however, that per the terms of its license agreement with 6 ClarkDietrich, ClarkDietrich cannot sue on its own. (Resp. at 9; see License Agreement 7 (Dkt. # 40 (sealed)).) Upon consideration of the parties’ submissions and its prior order, 8 the court agrees with CEMCO. As the court previously held, “CEMCO retained its
9 exclusionary rights in the Asserted Patents” and indeed has a “duty” to enforce the 10 Asserted Patents on ClarkDietrich’s behalf. (10/31/23 Order at 10.) Because the license 11 agreement did not transfer “all substantial rights” in the patents to ClarkDietrich, 12 CEMCO, as the patent owner and retainer of exclusionary rights in the Asserted Patents, 13 “is an indispensable party” to any lawsuit ClarkDietrich may file. See Alfred E. Mann
14 Found. for Sci. Rsch. v. Cochlear Corp., 604 F.3d 1354, 1359 (Fed. Cir. 2010). Contrary 15 to Defendants’ position, the inverse is not true. (See Reply at 6.) Defendants rely on 16 Aspex Eyewear, Inc. v. Miracle Optics, Inc., 434 F.3d 1336 (Fed. Cir. 2006), for the 17 principle that neither CEMCO nor ClarkDietrich may sue on their own (Reply at 6), but 18 the Federal Circuit has made clear that Aspex and its progeny did not “create a per se
19 rule” concerning indispensable parties, see Univ. of Utah v. Max-Planck-Gesellschaft zur 20 Forderung der Wissenschaften E.V., 734 F.3d 1315, 1326 (Fed. Cir. 2013). Indeed, the 21 Federal Circuit held that “there is no patent-specific exception to Rule 19(b)” and thus 22 “the court must still perform the inquiry under Rule 19(b).” Max-Planck-Gesellschaft, 1 734 F.3d at 1326. Because ClarkDietrich cannot sue Defendants without CEMCO, the 2 risk of Defendants incurring multiple or otherwise inconsistent obligations is de minimis.
3 See In re Schimmels, 127 F.3d 875, 881 (9th Cir. 1997) (“[F]ederal courts will bind a 4 non-party whose interests were represented adequately by a party in the original suit.” 5 (quoting Sw. Airlines Co. v. Tex. Int’l Airlines, Inc., 546 F.2d 84, 95 (5th Cir. 1977))). 6 Having determined that ClarkDietrich’s interests are adequately protected by 7 CEMCO and that Defendants are unlikely to be at risk of incurring multiple or otherwise 8 inconsistent obligations in ClarkDietrich’s absence, the court need not consider whether
9 any remaining prejudice may be lessened or avoided under Rule 19(b)(2) and instead 10 proceeds to consider the third factor. 11 ii. Factor 3: Adequate Judgment 12 The third factor concerns whether judgment in ClarkDietrich’s absence would be 13 adequate. See Fed. R. Civ. P. 19(b)(3). In determining this factor, the court must
14 consider three additional subfactors: (1) “whether the interests of a present party to the 15 suit are such that it will undoubtedly make all of the absent party’s arguments”; (2) 16 “whether the party is capable of and willing to make such arguments”; and (3) “whether 17 the absent party would offer any necessary element to the proceedings that the present 18 parties would neglect.” Klamath, 48 F.4th at 944 (quoting Dine Citizens, 932 F.3d at
19 852). Defendants do not address the adequacy of a judgment in ClarkDietrich’s absence 20 in their motion. (See generally Mot.) Instead, they argue in their reply that CEMCO 21 will not adequately represent ClarkDietrich’s interests because the two companies 22 compete in the firestopping market. (Reply at 7-8.) 1 Defendants’ argument that CEMCO somehow lacks the proper incentive to 2 adequately protect ClarkDietrich’s rights is not persuasive. To the contrary, CEMCO has
3 both a financial incentive and a contractual obligation to exclude others from practicing 4 the Asserted Patents (see generally License Agreement), and it has already done so 5 successfully in ClarkDietrich’s absence (see 10/31/23 Order at 4-5 (describing a May 6 2022 jury trial in which CEMCO prevailed on all claims against S4S).) The court 7 concludes that CEMCO’s interests and obligations are such that it is capable of and will 8 make any arguments ClarkDietrich otherwise would have made in this action. Therefore,
9 the court concludes that the third Rule 19(b) factor weighs in favor of CEMCO. 10 iii. Factor 4: Adequate Remedy 11 The fourth Rule 19(b) factor concerns whether CEMCO would have an adequate 12 remedy if this action were dismissed for nonjoinder. See Fed. R. Civ. P. 19(b)(4). The 13 court concludes that CEMCO would not have such a remedy. Venue against all
14 Defendants is likely only proper in this District. See 28 U.S.C. § 1400(b) (“Any civil 15 action for patent infringement may be brought in the judicial district where the defendant 16 resides, or where the defendant has committed acts of infringement and has a regular and 17 established place of business.”); (see also 8/16/23 S. Klein Decl. ¶¶ 1-5 (stating that the 18 Defendants reside in Bellevue, Washington)). Although KPSI appears to be organized
19 under the laws of Delaware (see 2d Am. Compl. ¶ 2), ClarkDietrich is organized under 20 the laws of Ohio (see id. ¶ 13; ClarkDietrich PJ Letter). Accordingly, there does not 21 appear to be any district in which venue is proper against Defendants that would also 22 have personal jurisdiction over ClarkDietrich absent ClarkDietrich’s voluntary 1 participation in the action. Pursuant to its license agreement with ClarkDietrich, CEMCO 2 retained the right to exclude others from practicing the Asserted Patents; it would almost
3 certainly be unable to do so if this suit were dismissed. 4 In sum, Defendants have failed to meet their burden under Rule 19(b) to 5 demonstrate that ClarkDietrich is an indispensable party. The court therefore concludes, 6 in equity and good conscience, that this action should proceed among CEMCO and 7 Defendants. See Fed. R, Civ. P. 19(b). Defendants’ motion to dismiss under Rule 8 12(b)(7) is DENIED. The court now considers Defendant’s motion to dismiss under Rule
9 12(b)(6). 10 B. Rule 12(b)(6) 11 Federal Rule of Civil Procedure 12(b)(6) provides for dismissal of a complaint 12 upon the plaintiff’s “failure to state a claim upon which relief can be granted.” Fed. R. 13 Civ. P. 12(b)(6). A Rule 12(b)(6) dismissal may “be based on the lack of a cognizable
14 legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” 15 Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988). A plaintiff’s 16 complaint must “contain sufficient factual matter, accepted as true, to ‘state a claim to 17 relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting 18 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Although the pleading standard
19 announced by Federal Rule of Civil Procedure 8 does not require “detailed factual 20 allegations,” it demands more than “an unadorned, the-defendant-unlawfully-harmed-me 21 accusation.” Id. (requiring the plaintiff to “plead[] factual content that allows the court to 22 // 1 draw the reasonable inference that the defendant is liable for the misconduct alleged” 2 (citing Twombly, 550 U.S. at 556)); see also Fed. R. Civ. P. 8(a)(2).
3 When considering a Rule 12(b)(6) motion, the court takes the well-pleaded factual 4 allegations as true and views such allegations in the light most favorable to the plaintiff. 5 Wyler Summit P’ship v. Turner Broad. Sys., Inc., 135 F.3d 658, 661 (9th Cir. 1998). The 6 court need not, however, accept as true a legal conclusion presented as a factual 7 allegation, Iqbal, 556 U.S. at 678, nor is the court required to accept as true “allegations 8 that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences,”
9 Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). 10 Here, Defendants argue that CEMCO’s complaint fails to allege facts sufficient to 11 state plausible claims for relief for patent infringement and fraudulent transfer of assets. 12 The court considers each argument in turn. 13 1. Patent Infringement
14 Defendants assert that CEMCO’s second amended complaint is devoid of any 15 factual allegations that Defendants are infringing the Asserted Patents and instead 16 “repeatedly asserts in conclusory fashion that the Defendants have engaged in direct 17 infringement or have committed infringing acts without specifying a single fact” in 18 support of those assertions. (Mot. at 6-7.) CEMCO responds that the court already
19 determined that it “need not consider” Defendants’ arguments concerning the sufficiency 20 of CEMCO’s patent infringement allegations. (Resp. at 12 (quoting 10/31/21 Order at 21 18-19).) CEMCO misunderstands the court’s prior order. 22 // 1 In its October 31, 2023 order, the court dismissed CEMCO’s patent infringement 2 allegations with leave to add ClarkDietrich as a co-plaintiff. (10/31/23 Order at 18.)
3 Because the court dismissed those allegations under Rule 12(b)(7), the court wrote that it 4 “need not consider in this order Defendants’ arguments that CEMCO fails to adequately 5 plead patent infringement claims against [Defendants].” (Id. at 18-19.) Now that the 6 court has denied Defendants’ motion under Rule 12(b)(7), the court is prepared to 7 consider the merits of Plaintiffs’ patent infringement allegations. 8 In light of the court’s prior holding, CEMCO should have substantively responded
9 to Defendants’ arguments concerning the sufficiency of their allegations for direct and 10 indirect patent infringement. It is true that, “[i]f a party fails to respond to an argument 11 made on a motion to dismiss, a court may find such failure constitutes waiver or 12 abandonment of the issue.” Rozier v. Dep’t of Homeland Sec. Fed. Protective Serv., No. 13 2:21-cv-07232-SB-AFM, 2022 WL 2199938, at *3 (C.D. Cal. Mar. 7, 2022). The court
14 concludes, however, that it would be contrary to the interest of justice to dismiss 15 CEMCO’s patent infringement allegations based on its misunderstanding of the court’s 16 prior order. See Fed. R. Civ. P 1; cf. Fed. R. Civ. P. 60(b)(1). 17 Accordingly, the court ORDERS CEMCO to file a supplemental brief responding 18 to Defendants’ arguments concerning the sufficiency of its patent infringement
19 allegations by no later than February 9, 2024. The brief shall not exceed 2,000 words. 20 Defendants may file an optional supplemental reply, not exceeding 1,500 words, by no 21 later than February 16, 2024. 22 // 1 2. Fraudulent Transfer 2 The court now turns to Defendants’ renewed motion to dismiss CEMCO’s claims
3 for fraudulent transfer of assets. Rule 12(g)(2) prohibits “a party that makes a motion 4 under this rule” from “raising a defense or objection that was available to the party but 5 omitted from [an] earlier motion.” Fed. R. Civ. P. 12(g)(2); see A.M. v. Omegle.com 6 LLC, No. 3:21-cv-01674-MO, 2023 WL 1470269, at *1-2 (D. Or. Feb. 2, 2023) (barring 7 the defendant from making arguments that it “could have made . . . in its first motion to 8 dismiss” and finding that “efficiency and fairness counsel in favor of applying Rule
9 12(g)(2)”). 10 In its October 31, 2023 order, the court denied Defendants’ motion to dismiss 11 Plaintiffs’ fraudulent transfer claims. (See 10/31/23 Order at 20-22.) CEMCO did not 12 amend the claims in its second amended complaint. (Compare 1st Am. Compl. (Dkt. 13 # 16) at 14-16, with 2d Am. Compl. at 14-17.)
14 Thus, CEMCO is correct that Rule 12(g)(2) prohibits Defendants from moving 15 again to dismiss these claims. (See Resp. at 12-13.) The court therefore DENIES 16 Defendants’ renewed motion to dismiss Plaintiffs’ fraudulent transfer claims. 17 IV. CONCLUSION 18 For the foregoing reasons, the court DENIES in part, RESERVES RULING in
19 part, and ORDERS supplemental briefing on Defendants’ motion to dismiss (Dkt. # 54). 20 The court DENIES Defendants’ motion to dismiss this case under Rule 12(b)(7) and to 21 dismiss CEMCO’s fraudulent transfer claims under Rule 12(b)(6). The court ORDERS 22 CEMCO to file a supplemental brief responding to Defendants’ arguments concerning 1 the sufficiency of its patent infringement allegations, not exceeding 2,000 words, by no 2 later than February 9, 2024. Failure to timely file a supplemental brief will result in the
3 court dismissing CEMCO’s claims for patent infringement with prejudice. Defendants 4 may file an optional supplemental reply to CEMCO’s supplemental brief, not exceeding 5 1,500 words, by no later than February 16, 2024. The court DIRECTS the Clerk to 6 re-note Defendants’ motion (Dkt. # 54) for February 16, 2024. 7 Dated this 29th day of January, 2024. A 8 JAMES L. ROBART 9 United States District Judge 10 11 12 13 14 15 16 17 18
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