1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 |} LELAND J. HEBERT, Case No.: 20-cv-1350-JO-MDD 12 Plaintitt, | ORDER DENYING PLAINTIFF'S 13 || Vv. MOTION FOR PARTIAL
15 MOTION FOR SUMMARY 16 Defendant.| JUDGMENT 17 18 19 20 Plaintiff Leland J. Hebert (“Plaintiff”) brought an action against his former busines: 21 |}partner and employer, Defendant Allied Rubber & Gasket Company (“Defendant”) 22 jjalleging patent infringement, false marking, and unfair competition surrounding 23 ||Defendant’s sale of adjustable wrenches. Plaintiff and Defendant filed cross-motions □□□ 24 ||summary judgment on the patent infringement claim. Dkts. 44, 45. Defendant also filed < 25 ||motion for summary judgment on Plaintiffs false marking and unfair competition claims 26 ||Dkt. 45. The Court held oral argument on April 27, 2022. For the reasons discussed below 27 || Plaintiff’s motion [Dkt. 44] is DENIED and Defendant’s motion [Dkt. 45] is GRANTED. 28
1 I BACKGROUND 2 ||A. Factual Background 3 This action arises from a failed business partnership between Plaintiff and 4 ||Defendant. Plaintiff invented a wrench that adjusts to varying widths for use on fire 5 |isprinklers of different sizes. He obtained United States Patent No. 8,850,931 (the “’931 6 patent”), which covers a universal offset wrench with a width-adjustable head for fire 7 ||sprinkler systems. Dkt. 31, Ex. 1 (931 Pat.”). Prior to partnering with Defendant, 8 || Plaintiff sold his adjustable wrenches on his own website. 9 Plaintiff and Defendant, a company that sells plumbing and fire sprinkler equipment. 10 |/initially entered into a partnership that permitted Defendant to exclusively distribute 11 || Plaintiff's wrenches. In July 2015, Defendant’s CEO and President, James Stoddard (“Mr. 12 || Stoddard”), began negotiating an agreement with Plaintiff to purchase Plaintiffs adjustable 13 || wrench—ultimately known as the “Recessed Wrench”—for resale. Dkt. 47 (“Plaintiff's 14 || Opp.”), Ex. A. In a contract executed on April 13, 2016, the parties agreed that Defendant 15 || would purchase unspecified “Patented Products” (presumably, the Recessed Wrench) from 16 || Plaintiff for exclusive distribution. Jd, Ex. B. Pursuant to the contract, Defendant paid 17 ||$25 per wrench to Plaintiff. Jd In return, Plaintiff applied Defendant’s logo to the 18 wrenches. Jd. He also directed the customers on his website to click a link to Defendant’s 19 || website to purchase the wrenches directly from Defendant. Id. 20 A few months later, in July of 2016, Plaintiff and Defendant switched to a different 21 |}manufacturer for the Recessed Wrench. On Defendant’s recommendation, Plaintiff began 22 || working with manufacturer Wang Cong (“Mr. Wang’’) to produce the Recessed Wrenches 23 ||that he would sell to Defendant. Dkt. 45-4 (Declaration of James Stoddard, “Stoddard 24 ||Decl.”) 9 13. With the consent of Defendant, see id. J] 15—16, Plaintiff instructed Mr. 25 || Wang to place the ‘931 patent number on these wrenches. Dkt. 45-5 (Declaration of Wang 26 ||Cong, “Wang Decl.”) § 8. Plaintiff eventually transitioned from being Defendant’s 27 business partner to working as a direct employee of Defendant. In December 2016, 28 Defendant hired Plaintiff as an employee. Stoddard Decl. 18. As an employee, Plaintiff
1 || was responsible for working with Mr. Wang to manufacture the Recessed Wrench. Jd 2 ||Defendant thereafter purchased the Recessed Wrench directly from Mr. Wang’: 3 ||manufacturing facility. Jd. During Plaintiff's employment, Defendant also manufacturec 4 || three other models of an adjustable wrench: the Offset Wrench, the Concealer Wrench, anc 5 ||the Socket Wrench. Jd. 93,9, 10. Defendant did not mark or sell these models for variou: 6 ||reasons. For example, Plaintiff worked with Mr. Wang to manufacture and mark the Offse 7 || Wrench with Plaintiff's patent number, but the wrench was ultimately defective and neve 8 ||sold by Defendant. Jd. 22. The Concealer Wrench was also never sold because it existec 9 as a prototype. Jd. § 10. The Socket Wrench, which is a version of the Recessec 10 || Wrench without a handle, was never marked with the patent number. Jd. J 9; Dkt. 45-1 a 11 fn.5. 12 Ultimately, disputes between Plaintiff and Defendant began to arise. In □□□□□□□□ 13 2018, Defendant terminated Plaintiff's employment. Stoddard Decl. § 20. After Plaintiff: 14 termination, Defendant did not order additional Recessed Wrenches from Mr. Wang, bu 15 did maintain and sell a small existing inventory which had already been marked with 16 ||Plaintiffs patent number during their business relationship. Jd. In January 2019, Mr 17 || Stoddard sent an email to Plaintiffs representative discussing Plaintiff's patent and thei 18 || prior business arrangement. Plaintiff's Opp., Ex. D. Mr. Stoddard described his frustratior 19 with Plaintiff's work, stating that Plaintiff's original design required modifications tc 20 || “really work” such that Plaintiff was not the sole inventor of any of these products. Jd. Ir 21 ||May 2020, Mr. Stoddard sent an email to another individual representing Plaintif 22 ||regarding a potential settlement offer. Jd., Ex. E. 23 ||B. Procedural History 24 Plaintiff filed his initial complaint on July 16, 2020, alleging that Defendant □□□□ □□□□□ 25 || infringed his ‘931 patent by selling the Offset Wrench after Plaintiff was terminated. Dkt 26 On April 29, 2021, Plaintiff filed an Amended Complaint alleging that the Recessec 27 || Wrench, Socket Wrench, and Concealer Wrench, in addition to the Offset Wrenct 28 || (collectively, the “Accused Wrenches”), also infringed the ‘931 patent. Dkt. 31 (FAC)
1 ||Plaintiffs Amended Complaint included additional causes of action for false marking 2 |}under 35 U.S.C. § 292 and unfair competition under California Business and Professions 3 ||Code § 17200. Id. These three causes of action are now the subject of the parties’ motions 4 || for summary judgment. 5 1. ‘931 Patent Claim Language 6 With regard to patent infringement, the parties focus their motions for summary 7 || judgment on whether Defendant sold wrenches containing the features protected by claims 8 111, 8, and 2 of Plaintiffs ‘931 patent. Claims 1 and 8 are the independent claims of the ‘931 9 || patent, which means that these claims each contain all the features of the invention. Claim 10 is a dependent claim of claim 1, which means that it describes additional features of an 11 aspect of claim 1. 12 First, claim 1 of the ‘931 patent describes the protected invention as an “offset 13 || wrench with adjustable head” comprising, in relevant part, “a smooth collar comprising a 14 |{smooth interior wall affixed to said shank opposite said fixed jaw; a threaded collar 15 ||comprising a threaded interior wall affixed to said base member opposite said jaw 16 |i}member,” and “an adjustment mechanism mechanically connected between said smooth 17 |icollar and said threaded collar for adjusting a distance between said fixed jaw and said 18 || adjustable jaw.” ‘931 Pat. at 7:5—49. 19 Second, claim 8 similarly describes the protected invention as an “offset wrench with 20 ||adjustable head,” comprising, in relevant part, “a smooth collar comprising a tubular 21 ||member having smooth interior wall affixed to a back surface of said shank opposite said 22 || fixed jaw; and a threaded collar comprising a tubular member having threaded interior wall 23 || affixed to a back surface said base member opposite said jaw member,” and “an adjustment 24 ||mechanism mechanically connected to said smooth collar and said threaded collar for 25 || adjusting a distance between said fixed jaw and said adjustable jaw.” Jd. at 8:7—28. 26 Finally, claim 2 of the ‘931 patent further describes the “adjustment mechanism” 27 feature of claim 1 as follows: “The device of claim 1, wherein said adjustment mechanism 28 || comprises: an actuator wheel; a smooth shaft extending from a first side of said wheel and
1 ||/insertably attached within said smooth collar; and, a threaded shaft extending from ar 2 || opposing second side of said wheel and threadingly mated with said threaded collar.” Jd 3 at 7:42. 4 2. Claim Construction Hearing! 5 The Court held a claim construction hearing on June 15, 2021. The parties disputec 6 || four terms and phrases from claims 1, 2, 8, and 9: (1) “collar,” (2) “threaded,” (3) 7 ||“adjustment mechanism mechanically connected between said smooth collar and saic 8 || threaded collar for adjusting a distance between said fixed jaw and said adjustable jaw,’ 9 || and (4) “shaft.” Dkt. 41 (“Claim Construction Order”). The parties initially disputed the 10 “interior wall,” but stipulated during the hearing that the term should be construed a: 11 ||“inner surface.” Id. 12 After the hearing, the Court issued an order construing the disputed terms anc 13 phrases. The Court construed the terms “collar” and “shaft” according to their plain anc 14 |\ordinary meaning. Claim Construction Order at 3-4. The Court construed the term 15 || “threaded” as “having a thread, which is a helical-shaped groove or ridge.” Id. The Cour 16 ||construed the phrase “adjustment mechanism mechanically connected between saic 17 || smooth collar and said threaded collar for adjusting a distance between said fixed jaw anc 18 || said adjustable jaw” as a means-plus-function term subject to 35 U.S.C. 112(f). Id. at 4 19 || Hence, the Court construed the function to be “adjusting a distance between said fixed jaw 20 said adjustable jaw,” and the structure to be “an actuator wheel, a smooth shaf 21 extending from a first side of the wheel and attached to the smooth collar, and a threadec 22 || shaft extending from an opposing second side of the wheel and attached to the threadec 23 collar.” Id. at 6. 24 25 26 27 28 ' Judge Dana M. Sabraw held the claim construction hearing and issued a claim construction order prio! to the transfer of this case to the undersigned.
1 Il. LEGAL STANDARD 2 Summary judgment is appropriate under Federal Rule 56 if the moving party 3 ||demonstrates the absence of a genuine issue of material fact and the entitlement to 4 judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A fact 5 material when, under the governing substantive law, it can affect the outcome of the case. 6 || Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Fresno Motors, LLC v. 7 || Mercedes Benz USA, LLC, 771 F.3d 1119, 1125 (9th Cir. 2014). A dispute is genuine □□ □ 8 ||reasonable jury could return a verdict for the nonmoving party. Jd. A party seeking 9 ||summary judgment carries the initial burden of establishing the absence of a genuine issue 10 || of material fact. Celotex, 477 U.S. at 323. The moving party can satisfy this burden in two 11 || ways: (1) by presenting evidence that negates an essential element of the nonmoving 12 ||party’s case; or (2) by demonstrating that the nonmoving party failed to establish an 13 essential element of its case on which it bears the burden of proving at trial. Jd. at □□□□□□□ 14 ||The moving party may also satisfy its initial burden by demonstrating that the opposing 15 |{party lacks sufficient evidence from which a jury could find an essential element of the 16 || opposing party’s claim. Jd. at 325; Nissan Fire & Marine Ins. Co., Ltd. v. Fritz Cos., Inc., 17 F. 3d. 1099, 1102 (9th Cir. 2000). 18 Once the moving party establishes the absence of genuine issues of material fact, the 19 ||burden shifts to the nonmoving party to set forth facts showing that a genuine issue of 20 || disputed fact remains. Celotex, 477 U.S. at 314. The nonmoving party cannot merely rest 21 his pleadings, but must direct the court to specific, triable facts by “citing to particular 22 ||parts of materials in the record.” Fed. R. Civ. P. 56(c)(1)(A) (emphasis added); see 23 || Anderson, 477 U.S. at 250. When ruling on a summary judgment motion, the court must 24 || view all inferences drawn from the underlying facts in the light most favorable to the 25 ||nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 26 || (1986). 27 When an accused infringer seeks summary judgment of non-infringement, “nothing 28 |imore is required than the filing of a motion stating that the patentee has no evidence of
1 ||infringement and pointing to the specific ways in which the accused [products do] not mee 2 |; the claim limitations.” Exigent Tech., Inc. vy. Atrana Sols., Inc., 442 F.3d 1301, 1309 (Fed 3 || Cir. 2006). A patentee claiming infringement “must present proof that the accused produc 4 meets each and every claim limitation.” Forest Labs., Inc. v. Abbot Labs., 239 F.3d 1305 5 1310 (Fed. Cir. 2001). Unsupported or conclusory statements of experts are insufficient tc 6 ||raise a genuine issue of material fact precluding summary judgment. TechSearch, L.L.C 7 Intel Corp., 286 F.3d 1360, 1372 (Fed. Cir. 2002). 8 Il. DISCUSSION 9 || A. Patent Infringement 10 With regard to the patent infringement claim, Plaintiff moves for summary judgmen 11 || of infringement on the grounds that the Recessed Wrench meets all the limitations of clair 12 ||2. Defendant cross-moves for summary judgment of non-infringement on the grounds tha 13 ||the Accused Wrenches do not meet all the limitations of claims 1 and 8. The Cour 14 || examines the infringement claim below. 15 Although Plaintiffs patent infringement argument centers on whether the Recessec 16 Wrench meets all the limitations of dependent claim 2, the Court must first □□□□□□□ 17 ||independent claims | and 8 to determine patent infringement. An accused product canno 18 |/infringe a dependent claim—a subset of an independent claim—unless the produc 19 || infringes that related independent claim. London v. Carson Pirie Scott & Co., 946 F.2« 20 || 1534, 1539 (Fed. Cir. 1991). Here, claims 1 and 8 are the independent claims of the ‘931 21 |jpatent. Each of the remaining claims, including claim 2, is dependent upon either claim: 22 ||1 or 8. Accordingly, to determine patent infringement, the Court examines whether the 23 || Accused Wrenches meet all the limitations of independent claims 1 and 8, which includes 24 || the dependent claims such as claim 2. 25 1. The Accused Wrenches do not infringe claims 1 or 8 of the ‘931 patent. 26 The Court now turns to the merits of the patent infringement claim. Because the 27 || Court has, in its Claim Construction order, already construed the meaning of the claims 28 make up the patent, the Court now examines whether the Accused Wrenches contair
1 the limitations—that is, all the features protected by the patent—of at least one 2 independent claim in the ‘931 patent. Transocean Offshore Deepwater Drilling, Inc. v. 3 || Maersk Drilling USA, Inc., 699 F.3d 1340, 1356 (Fed. Cir. 2012) (every limitation of a 4 |lclaim must be found in the accused product to establish literal infringement). If the 5 || Accused Wrenches lack even one limitation or protected feature of a claim, a plaintiff 6 ||cannot establish literal infringement of the patent. Lantech, Inc. v. Keip Mach. Co., 32 7 542, 547 (Fed. Cir. 1994) (requiring that “each limitation of the claim must be met by 8 ||the accused device exactly” and “any deviation from the claim preclud[es] a finding of 9 |/infringement”). Thus, the Accused Wrenches cannot infringe the ‘931 patent “if any claim 10 |}element or limitation is missing entirely from the accused product.” London v. Carson 11 || Pirie Scott & Co., 946 F.2d 1534, 1539 (Fed. Cir. 1991). 12 As further explained below, the Court concludes Plaintiff has failed to establish that 13 Accused Wrenches meet all the limitations of claims 1 or 8 as required for a finding of 14 ||infringement—in other words, Plaintiff fails to provide sufficient evidence that the 15 || Accused Wrenches contain each of the described elements of claims 1 or 8. Specifically, 16 ||the Court concludes that the Accused Wrenches do not meet the limitation of (a) a 17 “threaded collar comprising a threaded interior wall” or (b) a “a smooth shaft extending 18 || from a first side of the [actuator] wheel and attached to the smooth collar, and a threaded 19 extending from an opposing second side of the wheel and attached to the threaded 20 || collar.” 2] Claim Limitation: “Threaded collar comprising a threaded interior wall” 22 Based on the claim limitations of the ‘931 patent and the Court’s construction of 23 these limitations, the Accused Wrenches must contain a “collar” that has a “helical-shaped 24 || groove” in order for the Court to find infringement. As described above, claim 1 requires 25 “threaded collar comprising a threaded interior wall affixed to said base member opposite 26 ||said jaw member.” ‘931 Pat. at 7:33-36. Claim 8 similarly requires “a threaded collar 27 ||comprising a tubular member having threaded interior wall affixed to a back surface said 28 member opposite said jaw member.” Jd. at 8:21-22. The Court has construed the
1 || threaded collar limitation in these claims as requiring “a helical-shaped groove or ridge’ 2 its “interior wall”—+that is, its inner surface. See Claim Construction Order at 3-4. 3 Here, Plaintiff fails to submit evidence that the Accused Wrenches contained □ 4 || “threaded collar” with a “helical-shaped groove or ridge” on its inner surface. Plaintif 5 || points to a photograph of a metal L-shaped component as the purported threaded collar o: 6 ||the Offset Wrench, but an examination of that object shows a solid cylinder that has eigh 7 || parallel ridges on its exterior edge, rather than on an interior surface. Dkt. 45 (Declaratior 8 || of Paul Stewart, “Stewart Decl.”), Ex. 16. Similarly, Plaintiff points to a photograph of ar 9 ||angled metal component as the “threaded collar” of the Recessed Wrench and the Socke 10 || Wrench. /d., Ex. 17. However, an examination of that component similarly shows < 11 |/narrow solid cylinder with six parallel ridges on its exterior surface. Dkt. 44-2 (Declaratior 12 Leland Hebert, “Hebert Decl.”), Ex. E. While Plaintiff argues that the parallel ridge: 13 || constitute the “threaded” portion of the collar, Dkt. 44-1 at 7-8, the Court disagrees. The 14 ||ridges on the Offset Wrench, the Recessed Wrench, and the Socket Wrench are □□□□□□□ 15 ||helical nor on an interior surface, as required by the claims as construed by the Court 16 || Because Plaintiff's purported collar is a solid object, it does not have an inner surface 17 Instead, the ridges are parallel and on the exterior surface of the metal cylinder. 18 With regard to the Concealer Wrench’, Plaintiff separately argues that the “threadec 19 ||collar” is a circular hole through a metal jaw piece that allows the adjustment mechanisrr 20 connect. Stewart Decl., Ex. 8 (Plaintiff's Expert Report) J 25, Ex. 12. However, Plaintifi 21 submitted no evidence on the nature of this hole or whether its inner surface contain: 22 ||helical ridges or grooves. See Anderson, 477 U.S. at 250 (the opposing party “must se’ 23 || forth specific facts showing that there is a genuine issue for trial”). Accordingly, the Cour 24 |j/concludes that Plaintiff has failed to raise a triable issue as to whether the Accusec 25 |; Wrenches meet this limitation of claims 1 and 8. 26 27 28 The Concealer Wrench exists only as a prototype and was never brought to market. Stoddard Decl. 10
1 Claim Limitation: “a smooth shaft extending from a first side of the [actuator] wheel > and attached to the smooth collar, and a threaded shaft extending from _an opposing second side of the wheel and attached to the threaded collar” 3 Furthermore, the Accused Wrenches must also contain an actuator wheel with a 4 || smooth bar extending from one side of the wheel and a bar with helical-shaped grooves 5 extending from the opposite side in order for the Court to find infringement. As described 6 above, claims 1 and 8 require an “adjustment mechanism” that is “an actuator wheel, a 7 || smooth shaft extending from a first side of the wheel and attached to the smooth collar, and 8 || a threaded shaft extending from an opposing second side of the wheel and attached to the 9 || threaded collar.” Claim Construction Order at 6. The Court has construed the “shaft” 10 || jimitation in these claims to have its plain and ordinary meaning. Jd. I] The Court first examines the plain and ordinary meaning of the term “shaft,” and 12 || then turns to whether the Accused Wrenches contain an actuator wheel with a smooth shaft 13 extending from one side and a threaded shaft extending from the opposite side. The 14 ordinary meaning of a claim may be determined by reviewing “the claims themselves, the 15 specification, the prosecution history, dictionaries, and any other relevant evidence.” 16 || Ruckus Wireless, Inc. v. Innovative Wireless Sols., LLC, 824 F.3d 999, 1002-03 (Fed. Cir. 17 2016). Ultimately, the “only meaning that matters in claim construction is the meaning in 18 context of the patent.” Jd. (citing Trs. of Columbia Univ. in City of New York v. 19 Symantec Corp., 811 F.3d 1359, 1363 (Fed. Cir. 2016)). An inventor may not change the 20 meaning of his words to fit the particular circumstances of a trial. Chicago Steel Foundry 21 |! Co. v. Burnside Steel Foundry Co., 132 F.2d 812, 814-15 (7th Cir. 1943). Here, □□□□□□□□□□□ 22 patent claim describes a smooth shaft “extending from a first side of said wheel and 23 insertably attached within said smooth collar” and a threaded shaft “extending from an 24 opposing second side of said wheel and threadingly mated with said threaded collar.” ‘931 25 || Pat. at 7:42-51 (emphasis added). Additionally, both parties agreed that the meaning of a 26 ||“shaft” as a “Jong cylindrical bar or pole” is consistent with how Plaintiff intended to use 27 || the word “shaft” in his patent. Dkt. 33-1, Ex. C at 66:7-16; Dkt. 45-1 at 19. The claim 28 language and relevant evidence—particularly, the patentee’s intention of “shaft” to mean
1 “long cylindrical bar or pole” in the context of the patent—indicate that a shaft is ar 2 || object such as a bar or pole. 3 Having determined that a shaft is a bar or pole, the Court now examines whether the 4 Accused Wrenches contain an actuator wheel with a smooth bar or pole extending from 5 || one side, and a threaded bar or pole extending from the opposite side. Here, Plaintiff fails 6 ||to submit evidence of an actuator wheel component that has a threaded bar or pole 7 ||}extending from one side, and a smooth bar or pole extending from the opposite side 8 || Plaintiff points to a photograph of an actuator wheel component of the Concealer Wrench. 9 an examination of that component shows a bar with helical grooves extending fror 10 || both sides. Hebert Decl., Ex. F. The actuator wheel component does not contain a □□□□□ 11 ||/shaft extending from one of the sides as required by the claim limitations. Plaintifi 12 || argues that the smooth shaft of the Concealer Wrench is the two parallel bars on the handl« 13 the wrench. The Court rejects this argument because an examination of the two paralle 14 on the handle of the wrench shows that they do not interact with the actuator wheel as 15 ||/required by the claim limitations. 16 With regard to the Recessed Wrench, the Offset Wrench, and the Socket Wrench. 17 || Plaintiff points to a photograph of an actuator wheel with a hole through the middle tha 18 || does not have a bar or pole extending from either side. Hebert Decl., Ex. F. Plaintiff argues 19 the smooth shaft is the hole at the center of the actuator wheel. Plaintiff's Exper 20 ||Report, Ex. 7. The Court rejects this argument because a “shaft” is not construed to □□ 21 ||hole. See Claim Construction Order at 6; TechSearch, L.L.C., 286 F.3d at 1372. The Cour 22 || therefore concludes that the Accused Wrenches do not have a smooth shaft extending fror 23 side of the actuator wheel and a threaded shaft extending from the opposite side 24 || Accordingly, the Court finds that Plaintiff fails to raise a triable issue as to whether the 25 |; Accused Wrenches meet this limitation of claims 1 and 8. 26 | // 27 // 28
1 2. Patent marking does not per se warrant or preclude summary judgment on this > record. 3 The Court next addresses Plaintiff's argument that the patent marking on the 4 ||Recessed Wrench per se warrants summary judgment of infringement in his favor. 5 || Evidence of marking can function as an extrajudicial admission by the marking party “that 6 || the marked product falls within the scope of the patent claims.” Frolow v. Wilson Sporting 7 Goods Co., 710 F.3d 1303, 1310 (Fed. Cir. 2013). Like with other admissions, however, g ||a defendant may “introduce counter evidence or explanation” that rebuts such relevant g ||evidence supporting infringement. Jd. In Frolow, the court found that the plaintiffs 10 |;evidence of patent marking precluded summary judgment of non-infringement because 11 evidence, in combination with the defendant’s expert evidence that the accused 12 || product did not infringe, created a triable issue of material fact. 710 F.3d at 1310-11. The 13 |}court emphasized, however, that patent marking does not defeat summary judgment in 14 ||every instance and the outcome depends on the facts in the record. Id. at 1310; cf Hewlett- 15 || Packard Co. v. Repeat-O-Type Stencil Mfg. Corp., Inc., 123 F.3d 1445, 1454 (Fed. Cir. 16 1997) (granting summary judgment of non-infringement where defendant’s expert 17 ||explained that his “admissions” of infringement on the record were due to a 18 || misunderstanding). 19 Here, the history of the relationship between Plaintiff and Defendant explains how 40 Defendant’s Recessed Wrenches came to be marked with Plaintiff's patent number. 41 Initially, per their exclusive distribution agreement, Plaintiff manufactured the wrenches 49 ||and Defendant distributed them, paying Plaintiff $25 per wrench in return for exclusive 43 ||sale rights. Plaintiffs Opp, Ex. B. During this period, Defendant had no role in 74 ||manufacturing the wrenches or placing Plaintiffs patent number on these wrenches. 75 ||Stoddard Decl. § 13. Then, when Plaintiff and Defendant agreed to change the 46 ||manufacturer of the wrenches, Plaintiff instructed the new manufacturer to mark the 47 wrenches with the ’931 patent number. Jd. {| 16-17, Ex. 7. Defendant permitted this 4g ||arrangement, which continued even after Plaintiff started working for Defendant as an
1 |}employee. Jd. □□ 18-19. Defendant agreed to the marking of these wrenches based on the 2 assumption that Plaintiff's patent governed the Recessed Wrench. Plaintiff’s Opp., Ex. A 3 || However, after Plaintiff and Defendant terminated their working relationship, Defendan 4 expressed doubt over whether Plaintiff's patent even covered the Recessed Wrench. Id. 5 || Ex. D. 6 The above evidence indicates that Defendant’s agreement to the marking was borr 7 of its business relationship with Plaintiff rather than a reasoned conclusion of patent 8 coverage. Defendant simply assumed that Plaintiff's patent covered the wrenches he wa: 9 ||manufacturing, and then later discovered it did not. In the context of their business 10 relationship, the fact that Defendant acquiesced to Plaintiff marking the wrenches based or 11 |/an untested assumption does not create a triable issue of fact that infringement occurred 12 || Neonatal Product Group, Inc. v. Shields, 312 F. Supp. 3d 1010, 1023 (D. Kan. 2018 13 ||(finding patent marking on accused product was not an admission defeating summary 14 ||judgment of non-infringement where defendant company merely “assumed” the □□□□□□ 15 || covered the product but later realized it did not). Given the clear evidence that the Accusec 16 || Wrenches do not meet the claim limitations, the Court concludes that such an “admission’ 17 ||does not create an issue of fact any more than an expert’s unsupported conclusion or 18 ||infringement would. See Dynacore Holdings Corp. v. U.S. Philips Corp., 363 F.3d 1263 19 1278 (Fed. Cir. 2004) (holding that an expert’s unsupported and conclusory assertions are 20 || insufficient to raise a genuine issue of material fact). 21 ||B. False Marking 22 The Court now turns to Plaintiffs false marking claim, in which he alleges tha 23 Defendant injured him by selling Recessed Wrenches’ that were marked with Plaintiff’: 24 2aoio00—sSCSCisS 26 ||> After Plaintiff was terminated, the only Recessed Wrenches sold by Defendant were the remaining inventory that had been previously marked with Plaintiff’s patent number while he was still employed by 27 Defendant. Stoddard Decl. § 20. The Concealer Wrenches and the Offset Wrenches were never sold. Id 3g || 11 19.22.
1 || patent number without his consent. Defendant argues, and the Court agrees, that summary 2 judgment should be granted in favor of Defendant because Plaintiff fails to raise a triable 3 issue as to whether he suffered competitive injury from the sales of the Recessed Wrenches. 4 While the law prohibits false marking of devices, only a plaintiff who has suffered 5 ||a competitive injury from the false marking may bring suit. The false marking statute 6 || prohibits a party from marking a product with a patent number without the consent of the 7 patentee. 35 U.S.C. § 292(a). Only a person “who has suffered a competitive injury as a 8 ||result of a violation of this section” may bring an action to enforce Section 292(a). 35 9 ||U.S.C. § 292(b); Hall v. Bed Bath & Beyond, Inc., 705 F.3d 1357, 1373 (Fed. Cir. 2013) 10 || (plaintiff must prove that it “suffered a competitive injury as a result of the false marking” 11 ||to have statutory standing for false marking claim). Competitive injury is a “wrongful 12 ||economic loss caused by a commercial rival, such as the loss of sales due to unfair 13 ||competition [or] a disadvantage in a plaintiff's ability to compete with a defendant.” 14 || Sukumar v. Nautilus, Inc., 785 F.3d 1396, 1400 (Fed. Cir. 2015). In the false-marking 15 ||context, the injury must be one inflicted on a party’s competitive activity and caused by 16 ||the false marking. Jd. at 1402; Gravelle v. Kaba Ilco Corp., 684 Fed. Appx. 974, 979 (Fed. 17 || Cir. 2017) (affirming summary judgment for defendant on false marking claim due to “lack 18 || of concrete, non-speculative evidence of causation of an actual injury”). 19 Here, Plaintiff fails to submit evidence that he suffered competitive injury caused by 20 ||the patent marking on Defendant’s wrenches. Plaintiff does not point to any evidence that 21 suffered a loss of sales, reputation, or the ability to compete as a result of the Recessed 22 || Wrenches that were marked with the ‘931 patent number. To the contrary, Plaintiff did not 23 ||sell the Recessed Wrench as a competitor upon entering into an initial exclusive 24 |! distribution agreement with Defendant. Plaintiff's Opp., Ex. B. Moreover, the record 25 || shows that Plaintiff did not sell or attempt to sell his own Recessed Wrench as a competitor 26 being hired, and subsequently fired, by Defendant. Nor has Plaintiff submitted any 27 ||evidence in the record that Defendant failed to pay him royalties. By entering into an 28 exclusive distribution agreement, Plaintiff and Defendant agreed to not act as competitors;
1 financial injury he suffered working with Defendant under that agreement would be 2 ||damages for breach of contract rather than “competitive” injury that he suffered as a □□□□□□ 3 ||of Defendant’s failure to pay “royalties on the falsely marked sales.” Stewart Decl., Ex 4 at 60. Therefore, Plaintiff neither suffered a loss of sales nor a competitive disadvantage 5 another company as a result of the patent marking. Sukumar, 785 F.3d at 1400. 6 Plaintiff's false marking claim fails on additional grounds because Plaintif 7 {consented to the patent marking on Defendant’s wrenches. Plaintiff argues that he seeks 8 ||\damages “confined to the sales [Defendant] wrongfully made under the exclusive 9 distribution agreement.” Plaintiff's Opp. at 22. While under the exclusive distributior 10 ||agreement, however, Plaintiff gave consent for Defendant to mark the Recessed Wrenches 11 exchange for a payment of $25 per wrench. Jd., Ex. B; Wang Decl. { 8 (“In accordance 12 || with the instructions provided by Mr. Hebert in the engineering drawing, the file in Exhibi 13 ||2, and the authorization letter, I manufactured the Recessed Wrench bearing the □□□□□ 14 || patent number]. No one other [sic] Mr. Hebert ever discussed with me the placement o: 15 |/this patent number on the Recessed Wrench.”). Accordingly, the Court concludes tha 16 || Plaintiff fails to create a triable issue as to whether he suffered competitive injury as a resul 17 ||of the marked Recessed Wrenches and whether the Recessed Wrenches were markec 18 || without the consent of the patentee. 19 ||C. Unfair Competition 20 The Court finally turns to Plaintiff's claim that Defendant engaged in unfai 21 |} competition in violation of California’s Unfair Competition Law, Cal. Bus. & Prof. Code 22 || § 17200 (“Section 17200”). Plaintiff alleges that Defendant engaged in unfair competitior 23 |lin the following five ways: (1) falsely marking its Recessed Wrenches with Plaintiff’: 24 patent number, (2) seeking to invalidate Plaintiff's patent through litigation, (3) making 25 || discouraging statements to potential counsel for Plaintiff to deter them from representing 26 || Plaintiff, (4) making “bullying statements” to Plaintiff, and (5) “disparaging” Plaintiff tc 27 || third parties. FAC §§ 58-63; Stewart Decl., Ex. 13. The Court examines each allegatior 28 turn.
Section 17200 prohibits “unfair competition” which is broadly defined as “any 2 ||}unlawful, unfair or fraudulent business act or practice.” Cal. Bus. & Prof. Code § 17200. 3 ||Each prong of the statute is a separate and distinct theory of liability. Kearns v. Fora 4 || Motor Co., 567 F.3d 1120, 1127 (9th Cir. 2009) (citing South Bay Chevrolet v. General 5 || Motors Acceptance Corp., 72 Cal. App. 4th 861 (1999)). The “unlawful” prong “borrows 6 || violations of other laws and treats these violations, when committed pursuant to business 7 ||activity, as unlawful practices independently actionable under Section 17200.” Farmers 8 || Ins. Exch. v. Superior Court, 2 Cal. 4th 377, 383 (1992). A “defendant cannot be liable 9 || under § 17200 for committing unlawful business practices without having violated another 10 ||law.” Ingels v. Westwood One Broadcasting Servs., Inc., 129 Cal. App. 4th 1050, 1060 11 ||(2005) (internal quotations omitted). Conduct under the “fraudulent” prong is conduct that 12 |Jis “likely to deceive.” Morgan v. AT&T Wireless Servs., Inc., 177 Cal. App. 4th 1235, 13 ||1254 (2009). A claim under the fraudulent prong is governed by the “reasonable 14 ||consumer” standard, which requires the plaintiff to “show that members of the public are 15 likely to be deceived.” Williams vy. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008). 16 ||Section 17200 requires a party to have suffered an “injury in fact” and “lost money ot 17 || property as a result of the unfair competition.” Lozano v. AT&T Wireless Servs., Inc., 504 18 || F.3d 718, 731 (9th Cir. 2007). 19 I. False marking 20 First, Plaintiff argues that Defendant’s false marking constitutes unlawful and 21 || deceptive conduct. A claim under the “unlawful” prong hinges upon whether a □□□□□□□□□ 22 ||has a viable claim under the predicate law. Farmers Ins. Exch., 2 Cal. 4th at 383; Martinez 23 Welk Group, Inc., 907 F. Supp. 2d 1123, 1139 (S.D. Cal. 2012) (granting summary 24 || judgment for defendant under Section 17200’s unlawful prong where plaintiff no viable 25 || predicate claim). Because Plaintiff fails to raise a triable issue on his false marking claim, 26 27 ng ||* Plaintiff does not argue liability or present any evidence under the “unfair” prong, and so the Cour focuses its analysis on the “unlawful” and “fraudulent” prongs.
1 described above, the Court grants summary judgment in favor of Defendant or 2 Plaintiff's unfair competition claim to the extent it relies on the alleged false marking a: 3 predicate act. 4 Plaintiff has also failed to submit any evidence to support this claim under the 5 “fraudulent” prong, and so the Court grants summary judgment on the “fraudulent” prong 6 || based on Plaintiff's failure to point to triable facts in the record. Celotex, 477 U.S. at 314 7 2. Litigation conduct seeking to invalidate the patent 8 Second, Plaintiff argues that Defendant’s actions in this litigation to challenge the 9 || validity of the ‘931 patent constitute unlawful and deceptive conduct. It is well-establishec 10 || that free competition favors challenging the validity of patents. Lear, Inc. v. Adkins, 395 11 ||U.S. 653, 670 (1969) (challenging patent validity supports public interest in full and free 12 ||competition). Moreover, the Noerr-Pennington doctrine protects those who petition the 13 || courts—including in the form of filing a counterclaim or other pleadings—from liability 14 || for statutory violations. Freeman v. Lasky, Haas & Cohler, 410 F.3d 1180, 1184 (9th Cir 15 |}2005); Manistee Town Ctr. v. City of Glendale, 227 F.3d 1090, 1092 (9th Cir. 2000). Here 16 alleged conduct is Defendant’s counterclaim for a declaratory judgment of invalidity 17 || This conduct challenging the validity of the ‘931 patent falls squarely within the scope o: 18 petition to the court that is protected by the Noerr-Pennington doctrine. Therefore, the 19 Court grants summary judgment in favor of Defendant on Plaintiff's unfair competitior 20 ||claim to the extent it relies on Defendant’s actions to challenge the validity of the ‘931 21 || patent. 22 3. Statements to potential counsel for Plaintiff 23 Third, Plaintiff argues that Defendant’s statements “discourag[ing] counsel anc 24 potential counsel for [Plaintiff] from representing [Plaintiff]” in the litigation constitute 25 unfair and deceptive conduct. FAC § 63. Plaintiff points to several communications ir 26 ||which Mr. Stoddard communicates settlement offers and Defendant’s position or 27 Plaintiff's patent. Dkt. 47-4 at 2-3; Dkt. 47-5. However, Plaintiff does not point to any 28 |} communications that contain the “discouragement” that he alleges. Therefore, even if suct
1 |\allegations about discouragement could state a claim for relief under Section 17200, the 2 Court finds that Plaintiff has not raise a triable issue of fact that such discouragement has 3 |joccurred. The Court grants summary judgment in favor of Defendant on Plaintiffs □□□□□□ 4 || competition claim to the extent it relies on Defendant’s statements “discouraging” counsel. 5 4. “Bullying” statements to Plaintiff 6 Fourth, Plaintiff argues that Defendant’s “bullying” statements to Plaintiff constitute 7 |lunlawful and deceptive conduct. Plaintiff's amended complaint alleged “bullying” 8 || statements from Mr. Stoddard to Plaintiff that he “no longer owned the patent” and that he 9 || would “blow holes in [his] patent.” FAC 9 63. However, Plaintiff does not point to any of 10 |Ithese purported “bullying” statements in the record. Plaintiff cannot merely rely on his 11 |} pleadings and thus fails to meet his burden of pointing to triable facts in the record. Fed. 12 Civ. P. 56(c)(1)(A). Therefore, the Court grants summary judgment in favor of 13 || Defendant on Plaintiff's unfair competition claim to the extent it relies on Defendant’s 14 alleged bullying statements to Plaintiff. 15 5. “Disparaging” statements about Plaintiff to third parties 16 Finally, Plaintiff argues that Defendant’s “disparaging” statements made to third 17 parties constitute unlawful and deceptive conduct. Plaintiff not pointed to any evidence 18 in the record regarding disparaging statements made to third parties by Defendant. Because 19 |! Plaintiff fails to meet his burden of pointing to specific facts to raise a triable issue, Celotex, 20 U.S. at 314, the Court grants summary judgment in favor of Defendant on □□□□□□□□□□□ 21 unfair competition claim to the extent it relies on these allegedly disparaging statements. 22 Therefore, the Court finds that Plaintiff has failed to raise triable issues of material 23 || fact on each of the grounds for the unfair competition claim. 24 IV. CONCLUSION 25 For the reasons discussed above, Plaintiff’s motion for partial summary judgment of 26 infringement [Dkt. 44] is DENIED. Defendant’s cross-motion for summary judgment of 27 non-infringement and summary judgment on false marking and unfair competition [Dkt. 28 || 45] is GRANTED.
1 Pursuant to Federal Rule of Civil Procedure 58, the Court enters judgment in favor 2 ||of Defendant and ORDERS the Clerk to close the case. 3 4 IT IS SO ORDERED AND ADJUDGED. 5 6 || Dated: | g d | LL, 7
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