Force MOS Technology Co., Ltd. v. Lin

• Court: District Court, N.D. California
• Decided: August 31, 2023
• Docket: 5:22-cv-08938
• Status: Unknown

Opinion

1 2 UNITED STATES DISTRICT COURT 3 NORTHERN DISTRICT OF CALIFORNIA 4 5 FORCE MOS TECHNOLOGY CO., LTD., Case No. 22-cv-08938-SVK

6 Plaintiff, ORDER ON MOTION TO DISMISS 7 SECOND AMENDED COMPLAINT v. OR, IN THE ALTERNATIVE, MOTION 8 TO STRIKE AND/OR MOTION FOR A MORE DEFINITE STATEMENT; 9 ORDER SETTING CASE BO-IN LIN, MANAGEMENT CONFERENCE; 10 ORDER OF REFERRAL TO Defendant. 11 SETTLEMENT CONFERENCE Re: Dkt. No. 35 12

13 This lawsuit concerns 16 patents (the “Patents”) that were assigned to Plaintiff Force MOS 14 Technology Co., Ltd. (“Plaintiff” or “Force MOS”) by the inventor, non-party Fu-Yuan Hsieh 15 (“Hsieh”). Defendant Bo-In Lin (“Defendant” or “Lin”) prosecuted the Patents. The 16 United States Patent and Trademark Office (“USPTO”) deemed each of the Patents expired when 17 Force MOS failed to pay required maintenance fees, which may have given other individuals or 18 entities intervening rights to practice the Patents. Force MOS later revived the Patents by paying 19 the maintenance fees owed and additional fees. In this action, Force MOS asserts legal 20 malpractice and other claims against Lin due to his alleged failure to pay the maintenance fees for 21 the Patents or inform Force MOS of due dates for those fees. See Dkt. 27 – “Second Amended 22 Complaint” or “SAC.” All Parties have consented to the jurisdiction of a magistrate judge. 23 Dkt. 16, 32. 24 Now before the Court is Lin’s motion to dismiss the Second Amended Complaint or, in the 25 alternative, motion to strike and/or motion for a more definite statement. Dkt. 35 – the “Motion.” 26 The Court held a hearing on July 18, 2023. Having considered the Parties’ submissions and 27 arguments at the hearing, the applicable law, and the relevant litigation history in this action, the 1 Court GRANTS IN PART and DENIES IN PART the Motion for the reasons discussed below. 2 I. BACKGROUND 3 This background discussion is based primarily on the allegations of the Second Amended 4 Complaint, which are assumed to be true for purposes of this Motion. See Swift v. California, 384 5 F.3d 1184, 1188 (9th Cir. 2004). Defendant Lin is the attorney who prosecuted the 16 Patents at 6 issue in this case.1 SAC ¶ 32. The Patents, which issued between 2009 and 2013, were assigned 7 by the inventor (non-party Hsieh) to Plaintiff Force MOS. Id. ¶ 10. According to Plaintiff, it 8 hired Defendant to obtain and maintain the Patents. Id. ¶ 11. 9 Plaintiff summarizes the relevant patent law provisions as they relate to this case as 10 follows: Patentholders have certain exclusive intellectual property rights for a period (which for 11 the Patents in this case is up to 20 years) that begins on the date the patent issued and ends when 12 the patent expires. Id. ¶ 18. Among the requirements for a patentholder to keep a patent in force 13 is the periodic payment of maintenance fees to the USPTO. Id. ¶¶ 19-24. If a required 14 maintenance fee is not timely paid to the USPTO, another person or entity can gain “intervening 15 rights” to engage in acts that would otherwise constitute infringement of the patent. Id. ¶¶ 25-27. 16 The Patents in this case expired at various times between 2013 and 2020 due to 17 non-payment of maintenance fees and were later revived by Plaintiff’s payment of the unpaid 18 maintenance fees and other fees. Id. ¶¶ 35-173. Plaintiff claims that Defendant was obligated to, 19 but did not, pay the maintenance fees or inform Plaintiff that the fees were due. Id.; see also id. 20 ¶¶ 176-179. Plaintiff alleges that it did not learn of the expiration of the Patents until after it 21 retained other counsel to pursue enforcement and licensing of the Patents in 2022. Id. ¶¶ 174-175, 22 180. Plaintiff asserts that third parties began practicing the invention disclosed in the claims of at 23 least one of the Patents during the time the Patents were expired and that such third parties “may 24 assert a defense of intervening rights to shield themselves from liability for the practice of the 25 inventions in the Patents-at-Issue.” Id. ¶ 188. Plaintiff claims that it cannot recover the damages 26

27 1 The Patents are United States Patent Nos. 7,646,058; 7,511,357; 7,612,407; 7,633,121; 1 due from such third parties because of Defendant’s conduct that caused the Patents to expire. 2 Id. ¶ 189. 3 Plaintiff filed this lawsuit on December 16, 2022. Dkt. 1. The original Complaint 4 contained a single cause of action for professional negligence under California law. Id. Plaintiff 5 subsequently filed a First Amended Complaint and later a Second Amended Complaint, both of 6 which contained the following causes of action under California law: (1) legal malpractice, 7 (2) negligence, (3) breach of fiduciary duty, and (4) breach of implied contract. See Dkt. 14, 24, 8 25, 27. Force MOS asserts that this Court has subject matter jurisdiction over these claims based 9 on diversity. SAC ¶ 6. 10 Defendant’s Motion currently before the Court seeks dismissal of the SAC or, in the 11 alternative, a more definite statement of Plaintiff’s claims and/or an order striking certain portions 12 of the SAC. Dkt. 35 (Motion); see also Dkt. 45 (Reply). Force MOS opposes the Motion. 13 Dkt. 41 (Opposition). Both Parties requested that the Court to take judicial notice of various 14 documents. Dkt. 36 (Defendant’s Request for Judicial Notice of pleading filed in other litigation); 15 Dkt. 42 (Plaintiff’s Request for Judicial Notice of documents filed with the USPTO). 2 16 II. LEGAL STANDARD 17 A. Rule 12(b)(6) 18 Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint 19 if it fails to state a claim upon which relief can be granted. In ruling on a motion to dismiss, courts 20 may consider only “the complaint, materials incorporated into the complaint by reference, and 21 matters of which the court may take judicial notice.” Metzler Inv. GmbH v. Corinthian Colls., 22 Inc., 540 F.3d 1049, 1061 (9th Cir. 2008). In deciding whether the plaintiff has stated a claim, the 23 court must presume the plaintiff’s allegations are true and draw all reasonable inferences in the 24 plaintiff’s favor. Usher v. City of L.A., 828 F.2d 556, 561 (9th Cir. 1987). However, the court is 25 not required to accept as true “allegations that are merely conclusory, unwarranted deductions of 26 fact, or unreasonable inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 27 1 2008) (citation omitted). 2 To survive a motion to dismiss, the plaintiff must allege “enough facts to state a claim to 3 relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This 4 “facial plausibility” standard requires the plaintiff to allege facts that add up to “more than a sheer 5 possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662, 668 (2009). 6 If a motion to dismiss is granted, the court must grant leave to amend unless it is clear that 7 the complaint’s deficiencies cannot be cured by amendment. Eminence Capital, LLC v. Aspeon, 8 Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). 9 B. Rule 12(e) 10 Under Rule 12(e), “[a] party may move for a more definite statement of a pleading to 11 which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot 12 reasonably prepare a response.” Fed. R. Civ. P. 12(e). “A Rule 12(e) motion is proper only where 13 the complaint is so indefinite that the defendant cannot ascertain the nature of the claim being 14 asserted” and therefore “cannot reasonably be expected to frame a proper response.” Gregory 15 Village Partners, L.P. v. Chevron U.S.A., Inc., 805 F. Supp. 2d 888, 896 (N.D. Cal. 2011) (citing 16 Schwarzer, Tashima & Wagstaffe, Federal Civil Procedure Before Trial (2008 ed.) § 9:347). 17 Although motions for a more definite statement “are viewed with disfavor” because of the 18 “minimal pleading requirements of the Federal Rules,” a court should grant such a motion where 19 “the complaint is so general that ambiguity arises in determining the nature of the claim or the 20 parties against whom it is being made.” Austin v. County of Alameda, No. C–15–0942 EMC, 2015 21 WL 3833239, at *4 (N.D. Cal. June 19, 2015) (citations omitted); see also McHenry v. Renne, 84 22 F.3d 1172, 1179–80 (9th Cir.1996) (motion for more definite statement is appropriate where 23 complaint is “prolix” and “confusing”). 24 C. Rule 12(f) 25 Rule 12(f) enables a court to strike from a pleading “any redundant, immaterial, 26 impertinent, or scandalous matter.” The function of a Rule 12(f) motion is “to avoid the 27 expenditure of time and money that must arise from litigating spurious issues by dispensing with 1 2010). 2 3 D. Rule 9(b) 4 Claims sounding in fraud are subject to the heightened pleading requirements of Federal 5 Rule of Civil Procedure 9(b). Bly-Magee v. California, 236 F.3d 1014, 1018 (9th Cir. 2001). 6 A plaintiff alleging fraud “must state with particularity the circumstances constituting fraud.” 7 Fed. R. Civ. P. 9(b). To satisfy this heightened pleading standard, the allegations must be specific 8 enough to give defendants notice of the particular misconduct which is alleged to constitute the 9 fraud charged “so that they can defend against the charge and not just deny that they have done 10 anything wrong.” Kearns v. Ford Motor Co., 567 F.3d 1120, 1124 (9th Cir. 2009) (citation 11 omitted). Thus, claims sounding in fraud must allege “an account of the time, place, and specific 12 content of the false representations as well as the identities of the parties to the 13 misrepresentations.” Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir. 2007) (per curiam) 14 (internal quotations marks omitted). In other words, “[a]verments of fraud must be accompanied 15 by the who, what, when, where, and how of the misconduct charged.” Kearns, 567 F.3d at 1124 16 (internal quotation marks and citations omitted). The plaintiff must also set forth “what is false or 17 misleading about a statement, and why it is false.” Ebeid ex rel. U.S. v. Lungwitz, 616 F.3d 993, 18 998 (9th Cir. 2010) (internal quotation marks and citation omitted). 19 20 III. DISCUSSION 21 A. Statute of Limitations 22 Defendant argues that Plaintiff’s claims for legal malpractice, negligence, and breach of 23 fiduciary duty are barred by the statute of limitations and should be dismissed. Dkt. 35 at 7-12. 24 California Code of Civil Procedure § 340.6(a) provides: 25 An action against an attorney for a wrongful act or omission, other than for actual fraud, 26 arising in the performance of professional services shall be commenced within one year 27 after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date 1 2 Cal. C. Civ. P. § 340.6(a). This section further provides that the statute of limitations is tolled 3 under certain circumstances, including the time during which “[t]he attorney continues to 4 represent the plaintiff regarding the specific subject matter in which the alleged wrongful act or 5 omission occurred.” Cal. C. Civ. P. § 340.6(a)(2). 6 Defendant argues that Plaintiff’s claim for legal malpractice is barred because the face of 7 the SAC establishes that all of the Patents expired more than one year before Plaintiff filed this 8 lawsuit on December 16, 2022. Dkt. 35 at 7-10. Specifically, Defendant argues that the four-year 9 statute of limitations in section 340.6(a) bars Plaintiff’s claims relating to 15 of the 16 Patents 10 because those patents expired more than four years before Plaintiff filed suit. Id. at 8-9. 11 Defendant further argues that the remaining Patent expired more than one year before Plaintiff 12 filed suit. Id. Defendant argues that section 340.6 applies not only to Plaintiff’s claim for legal 13 malpractice, but also to Plaintiff’s claims for ordinary negligence, breach of fiduciary duty, and 14 breach of implied contract because all of the claims are based on allegations that an attorney 15 committed legal malpractice. Id. at 10-11. 16 Plaintiff responds by arguing that both the one-year and four-year provisions of section 17 340.6 were tolled pursuant to section 340.6(a)(2) by Defendant’s continuous representation of 18 Plaintiff. Dkt. 41 at 3-6. Plaintiff points to allegations in the SAC that: (1) Plaintiff hired 19 Defendant to prosecute multiple patent applicants and maintain resulting issued patents, (2) for 20 each of the Patents, Defendant was listed with the USPTO as the counsel of record, and 21 (3) Defendant was responsible for paying, and communicating to Plaintiff the need for payment of, 22 maintenance fees on the Patents. Id. at 4-5 (citing, e.g., SAC ¶¶ 28, 33, 177). Defendant counters 23 by arguing that any representation of Plaintiff ended no later than the time each of the Patents 24 expired. Dkt. 45 at 3-4. In the course of arguing whether there was continuous representation for 25 purposes of tolling, key factual disputes emerged, including whether Defendant ever represented 26 Plaintiff Force MOS (as opposed to the inventor, Hsieh) and, if so, when that representation 27 terminated. These factual disputes preclude a determination at this pleading stage of whether the 1 Plaintiff. 2 Another layer to the statute of limitations issue is delayed discovery. The Parties disagree 3 about which party bears the burden of pleading (and proving) that the statute of limitations did not 4 accrue earlier due to Plaintiff’s delayed discovery of Defendant’s alleged malpractice. Plaintiff 5 argues that because the statute of limitations under section 340.6 is an affirmative defense, 6 Defendant has the burden of pleading and proof on the issue, and Plaintiff cites California cases on 7 this issue. Dkt. 41 at 6-7. Defendant responds by citing federal cases holding that a plaintiff 8 seeking to delay the one-year statute of limitations based on delayed discovery must plead the 9 discovery-related facts. Dkt. 45 at 3. The Court finds that even if it is Plaintiff’s burden to plead 10 facts regarding its delayed discovery of Defendant’s alleged malpractice, Plaintiff has satisfied 11 that pleading burden. The SAC alleges that Plaintiff “did not learn of the premature expiration of 12 its intellectual property rights until it sought to enforce its patents against would-be infringers,” 13 which Plaintiff states occurred in May 2022. SAC ¶¶ 13, 42. That date is less than one year 14 before Plaintiff filed this case. 15 Under the circumstances of this case, the Court concludes that the applicability of the 16 statute of limitations cannot properly be determined at the pleading stage, and therefore 17 Defendant’s motion to dismiss on the grounds of the statute of limitations is DENIED. As 18 discussed at the hearing, however, because of these factual disputes on foundational issues 19 regarding whether and when Defendant represented Plaintiff, the Court is inclined to bifurcate the 20 issues of liability and damages in this case. This approach will be discussed further at the 21 upcoming Case Management Conference ordered below. 22 23 B. Duplicative Claims 24 Defendant argues that several of Plaintiff’s claims should be dismissed because they are 25 duplicative of the claim for legal malpractice. Dkt. 35 at 12-14. Defendant argues that Plaintiff’s 26 claim for breach of fiduciary duty is duplicative and should be dismissed because it arises from the 27 same facts and seeks the same relief as the claim for legal malpractice. Dkt. 35 at 12-13 (citing 1 that Plaintiff’s claims for professional negligence and for ordinary negligence are based on the 2 same factual allegations concerning Defendant’s performance of legal services, allege the same 3 harm (loss of patent rights caused by failure to pay maintenance fees), and comprise essentially 4 one form of action. Dkt. 35 at 12 (citing Flowers v. Torrance Mem. Hosp. Med. Ctr., 35 Cal. Rptr. 5 2d 685 (1994)). Plaintiff responds to this argument by asserting that its breach of fiduciary duty 6 and negligence claims are not identical to its claim for legal malpractice and by contending that it 7 has a right at this stage to plead claims in the alternative. Dkt. 41 at 8-9. 8 1. Breach of fiduciary duty 9 In reviewing the relevant case law, a district court in the Central District of California 10 concluded that although no California authority has addressed whether a claim for breach of 11 fiduciary duty may factually duplicate a legal malpractice claim, “cases in which courts applying 12 California law have allowed concurrent legal malpractice and fiduciary duty claims have involved 13 fiduciary duty claims based on factual allegations other than those supporting legal malpractice.” 14 Afont v. Poynter Law Group, No. SACV 17-01388 JVS (KESx), 2018 WL 6136147, at *6 15 (C.D. Cal. Nov. 5, 2018). Accordingly, the court granted summary judgment on a claim for 16 breach of fiduciary duty that was based on the same allegations as a claim for legal malpractice. 17 Id. at *7. For similar reasons, a Nevada district court dismissed a breach of fiduciary duty claim 18 that “ar[o]se from the same facts and allege[d] the same injury” as a claim for legal malpractice, 19 holding that “even under California law” the fiduciary duty claim was “duplicative.” Rennison v. 20 Laub, No. 3:19-cv-00320-MMD-CLB, 2020 WL 4274709, at *2 (D. Nev. July 24, 2020). 21 Here, Plaintiff has not alleged facts supporting the existence of any fiduciary duty outside 22 of the attorney-client relationship. To the contrary, Plaintiff’s claim for breach of fiduciary duty is 23 expressly premised on Defendant’s fiduciary obligations as an attorney for Plaintiff. See, e.g., 24 SAC ¶ 249 (“By virtue of the attorney-client relationship that existed between Attorney Lin and 25 Force MOS, Attorney Lin owed Force MOS a fiduciary duty”). Similarly, Plaintiff’s allegations 26 regarding Defendant’s breach of fiduciary duty relate to the same conduct that is the basis for 27 Plaintiff’s legal malpractice claim. Compare id. ¶ 252 (alleging that Defendant breached a 1 each of the Patents-at-Issue”), with id. ¶¶ 225-227 (alleging that Defendant committed legal 2 malpractice by, inter alia, failing to “notify Force MOS of the required maintenance fees and 3 corresponding due dates for payment to the USPTO,” “detect and timely notify Force MOS that 4 the maintenance fees could be paid during a grace period prior to the premature expirations of the 5 Patents-at-Issue,” and “notify Force MOS of the expiration of the Patents-at-Issue”). 6 Accordingly, the Court GRANTS Defendant’s motion to dismiss the breach of fiduciary 7 duty claim on the ground that it is duplicative of the claim for legal malpractice. 8 2. Negligence 9 Like Plaintiff’s claim for breach of fiduciary duty, its claim for ordinary negligence is 10 based on the same facts as its claim for legal malpractice. See, e.g., SAC ¶¶ 241-244 (alleging that 11 “[a]s patent counsel …. Attorney Lin had a duty to exercise reasonable skill in performing his 12 legal and other patent-related services for Force MOS,” which he breached when he “failed to take 13 proper steps to correct, or at least minimize, the harm to Force MOS caused by the failure to pay 14 maintenance fees on each of the Patents-at-Issue,” thereby “result[ing] in the loss of valuable 15 patent rights”). In the medical context, courts in this District have dismissed as duplicative 16 ordinary negligence claims that are based on the same facts as professional negligence claims. 17 See, e.g., Cotteril v. City and Cty. of S.F, No. C-08-02295 JSW, 2008 WL 3876153, at *5 (N.D. 18 Cal. Aug. 19, 2008); McKay v. Hageseth, No. C-06-1377 MMC, 2006 WL 8443033, at *6 (N.D. 19 Cal. May 24, 2006); see generally Flowers, 35 Cal.Rptr.2d at 689.3 The Court concludes that the 20 same approach is appropriate in the present case, even though it presents legal rather than medical 21 malpractice claims. At the hearing, Plaintiff argued that pleading alternative theories of 22 professional negligence and ordinary negligence is justified because Defendant disputes he ever 23 represented Plaintiff. However, this position is inconsistent with the ordinary negligence claim set 24 forth in the SAC, which is premised on Defendant’s alleged breach of a duty he owed “[a]s patent 25 counsel.” See SAC ¶ 241. Accordingly, the Court GRANTS Defendant’s motion to dismiss the 26 3 A similar rule regarding duplicative fiduciary duty claims in the context of legal malpractice 27 claims was articulated by a California court in Broadway Victoria, LLC v. Norminton, Wiita & 1 negligence claim on the ground that it is duplicative of the claim for legal malpractice. 2 3 C. Claim for Breach of Implied Contract 4 As with Plaintiff’s claims for negligence and breach of fiduciary duty, Defendant argues 5 that the claim for breach of implied contract is duplicative of Plaintiff’s claim for legal malpractice 6 because it is premised on Defendant’s alleged negligence in rendering legal services. Dkt. 35 at 7 13-14. However, the implied contract claim in SAC relies on alleged conduct distinct from the 8 conduct that forms the basis of Plaintiff’s claim for legal malpractice, which is discussed in 9 Section III.B.1. above, because the implied contract claim alleges that Defendant breached the 10 Parties’ implied contract “by continuing to charge and collect money from Force MOS in relation 11 to patent prosecution involving the trenched MOSFET technology despite knowing of the failures 12 to maintain the Patents-at-Issue.” SAC ¶ 258. 13 Defendant argues that the breach of implied contract claim should be dismissed for the 14 additional reason that it lacks the required factual allegations concerning the terms and formation 15 of the alleged implied contract. Dkt. 35 at 14. Under California law, an “attorney-client 16 relationship is created by some form of contract, express or implied, formal or informal.” Fink v. 17 Montes, 44 F. Supp. 2d 1052, 1060 (C.D. Cal. 1999) (quoting Responsible Citizens v. Superior 18 Court, 16 Cal.App.4th 1717, 1732 (1993)). “An implied contract is one, the existence and terms 19 of which are manifested by conduct.” Cal. Civ. C. § 1621. “The distinction between express and 20 implied in fact contracts relates only to the manifestation of the assent; both types are based upon 21 the expressed or apparent intention of the parties.” Fink v. Montes, 44 F. Supp. 2d at 1060 22 (citation omitted). “In determining whether an attorney-client relationship is created on the basis 23 of an implied contract, the court examines the totality of the circumstances” including “(1) the 24 nature and extent of the contacts between the attorney and the purported client; (2) whether the 25 purported client divulged confidential information to the attorney; (3) whether the attorney 26 provided the purported client with legal advice; and (4) whether the purported client sought or 27 paid for the attorney’s services.” Id. (internal citations omitted). 1 contract, Plaintiff has failed to allege facts to support the existence of such an implied contract 2 here. The SAC includes an adequate description of Defendant’s obligations under the alleged 3 contract as being his responsibility “for the drafting of multiple patent applications, serving as 4 counsel for record with the USPTO, and communicating as an intermediary between the USPTO 5 and the rightful owner regarding the patent applications (and subsequent issued patents) he 6 prosecuted.” SAC ¶ 11. However, the SAC includes only a conclusory allegation that Plaintiff 7 “hired and trusted Attorney Lin to act as their patent prosecutor.” Id.; see also id. ¶ 28 (“Force 8 MOS hired and trusted Attorney Lin to prosecute multiple patent applications and maintain any 9 issued United States Patents resulting from such patent applications”). The SAC does not contain 10 sufficient allegations concerning any relevant factors to be considered in determining whether an 11 implied contract was formed, such as the nature and extent of the contacts between Plaintiff and 12 Defendant; whether Plaintiff divulged confidential information to Defendant; whether Defendant 13 provided Plaintiff with legal advice; and whether Plaintiff sought or paid for the attorney’s 14 services. See Fink v. Montes, 44 F. Supp. 2d at 1060. 15 Accordingly, Defendant’s motion to dismiss the implied contract claim on the grounds that 16 the implied contract claim is duplicative of the legal malpractice claim is DENIED, but the 17 motion to dismiss the implied contract claim is GRANTED on the grounds that the SAC does not 18 allege sufficient facts regarding the formation of the alleged implied contract. 19 20 D. Claim for Damages Based on Intervening Rights 21 Defendant asks the Court to dismiss or strike Plaintiff’s allegations regarding its claim for 22 damages because it is based in part on unidentified infringers and patents. Dkt. 35 at 15-16. 23 Defendant further argues that with respect to the infringers who are identified in the SAC, a claim 24 for damages should be dismissed as speculative. Id. at 16. 25 The SAC alleges that Plaintiff has been damaged by the “premature expiration” of the 26 Patents because “[o]n information and belief, third parties, including but not limited to Diodes 27 Incorporated (‘Diodes’), ASUSTek Computer, Inc. (‘ASUS’), and inergy Technology, Inc. 1 Issue, such as the ’409 Patent, during the period the Patents-at-Issue, including the ’409 Patent, 2 were expired.” SAC ¶ 187. The SAC further alleges on information and belief that “existing 3 would-be infringing third parties may assert a defense of intervening rights to shield themselves 4 from liability for the practice of the inventions in the Patents-at-Issue.” Id. ¶ 188. Plaintiff alleges 5 that Defendant’s alleged conduct that led to expiration of the Patents means Plaintiff cannot 6 recover the damages due against third parties. Id. ¶ 189. 7 The Court agrees with Defendant that the reference to “ third parties, including but not 8 limited to” in paragraph 187 of the SAC should be stricken because it fails to adequately identify 9 third parties that allegedly infringe the Patents. Accordingly, the motion to strike that language is 10 GRANTED. To the extent Plaintiff subsequently identifies specific third party infringers that 11 may have obtained intervening rights as a result of Defendant’s alleged conduct, Plaintiff can 12 move to amend the complaint in this case accordingly. 13 As to Defendant’s argument that damages associated with the third party (alleged) 14 infringers who are identified by name in the SAC are speculative, the Court finds that the 15 allegations are sufficient at the pleading stage. Accordingly, the motion to dismiss or strike these 16 damages allegations is DENIED except as set forth above. 17 E. Fraud and Punitive Damages Allegations 18 Under California law, recovery of punitive damages requires a showing by clear and 19 convincing evidence that the defendant acted with oppression, fraud, or malice. Cal. Civ. C. 20 § 3294(a). Defendant argues that Plaintiff’s allegations and prayer for punitive damages should be 21 dismissed or stricken because Plaintiff fails to plead fraud with the particularity required under 22 Federal Rule of Civil Procedure 9(b) and fails to allege any facts showing oppression, fraud, or 23 malice to support its claim for punitive damages. Dkt. 35 at 17-18. 24 Plaintiff’s demand for punitive damages is based on the claim for breach of fiduciary duty, 25 in which Plaintiff alleges that Defendant’s actions “were done in bad faith with malice, fraud, 26 oppression, and a reckless disregard of the likelihood that the harm would result in substantial 27 damages to Force MOS.” SAC ¶ 255. As discussed in section III.B.1. above, the Court has 1 motion to strike the allegations and prayer for punitive damages that are premised on that cause of 2 action. See Doe v. Uber Techs., Inc., 184 F. Supp. 3d 774, 790 (N.D. Cal. 2016) (“At the 3 pleadings stage, a plaintiff need not plead all of the elements of a claim for punitive damages but 4 need only plead such facts as could plausibly support the underlying claim of fraud that will 5 support a punitive damages award”). If Plaintiff elects to amend the claim for breach of fiduciary 6 duty and reassert a claim for punitive damages, in any challenge to the amended complaint the 7 Court will evaluate whether the punitive damages claim is adequate in the context of that pleading. 8 See J.E.L. v. San Francisco Unified Sch. Dist., 185 F. Supp. 3d 1196, 1202 (N.D. Cal. 2016) 9 (denying motion to strike general allegations that defendants' acts were “negligent, careless, 10 reckless, and malicious” where the allegations were plausible in the context of the amended 11 complaint). 12 13 F. Leave to Amend 14 Defendant argues that the Court should dismiss the legal malpractice claim without leave 15 to amend because it is barred by the statute of limitations. Dkt. 35 at 18-19. For the reasons 16 discussed, the Court finds that questions of fact preclude a determination at the pleading stage of 17 whether the statute of limitations bars the legal malpractice claim and Defendant’s Motion on that 18 ground is DENIED. Insofar as the Court has granted Defendant’s Motion on other claims and 19 grounds, the Court grants Plaintiff LEAVE TO AMEND. 20 21 IV. ORDER 22 For the foregoing reasons, the Court GRANTS IN PART and DENIES IN PART 23 Defendant’s motion to dismiss, strike, or for a more definite statement and further ORDERS as 24 follows: 25 1. Plaintiff’s Third Amended Complaint is due no later than September 18, 2023. 26 2. A Case Management Conference will be held on November 14, 2023. The Joint 27 Case Management Statement is due November 7, 2023. 1 2 The case is REFERRED to Magistrate Judge Virginia K. DeMarchi for an early 3 settlement conference, with a completion deadline of December 29, 2023. The Parties are to 4 || contact Judge DeMarchi’s chambers promptly for scheduling. 5 SO ORDERED. 6 || Dated: August 31, 2023 4 Sees vat SUSAN VAN KEULEN 9 United States Magistrate Judge 10 11 12

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