Shenzhen Root Technology Co Ltd v. Chiaro Technology Ltd

Opinion

1 2 3

4 5 UNITED STATES DISTRICT COURT 6 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 SHENZHEN ROOT TECHNOLOGY CO CASE NO. C23-0631-KKE 8 LTD et al., ORDER GRANTING MOTION TO 9 Plaintiffs, AMEND COUNTERCLAIMS v. 10

CHIARO TECHNOLOGY LTD, 11

Defendants. 12

13 This matter comes before the Court on Defendant and Counterclaim Plaintiff Chiaro 14 Technology Ltd.’s (“Elvie”) motion for leave to amend its counterclaims. Dkt. No. 101. Elvie 15 seeks to add two patents and two products to this lawsuit, and to name Shenzhen Xitao Network 16 Technology Co., Ltd. (“Xitao”) as an additional counterclaim Defendant. Id. at 2. Counterclaim 17 Defendants Shenzhen Root Technology Co., Ltd., Hong Kong Lute Technology Co. Ltd., 18 Shenzhen Conglin e-Commerce Co., Ltd, Shenzhen Root e-Commerce Co., Ltd., Shenzhen TPH 19 Technology Co., Ltd., Shenzhen Lutejiacheng Network Technology Co., and Shenzhen Jinruihang 20 Technology Co., Ltd. (collectively “Momcozy”) do not oppose Elvie’s motion on its face, but 21 request that the Court extend the case schedule in the event the Court grants Elvie’s motion. Dkt. 22 No. 108 at 3. For the reasons explained here, the Court grants Elvie’s motion and declines to 23 modify the case schedule at this time. 24 1 I. FACTS 2 Both Momcozy and Elvie manufacture and sell wearable breast pumps. In April 2023, 3 Momcozy filed this action seeking declaratory judgment that Elvie’s U.S. Patent No. 11,357,893

4 (“the ’893 patent”) is not infringed by Momcozy products, and other declaratory, injunctive, and 5 monetary relief. See Dkt. No. 1 (original complaint), Dkt. No. 54 (amended complaint). The 6 complaint places at issue one patent and one Momcozy product, the S12 Pro. Dkt. No. 54 at 1–2. 7 On July 5, 2023, the Court issued an order setting the trial date and pretrial deadlines. Dkt. 8 No. 62. The initial case schedule issued by the Court provided for 28 months to trial, which is 9 comparable to other patent cases in this Court. See id.; Dkt. No. 109 at 9. Since issuing the 10 schedule, the Court has granted multiple stipulated motions to continue deadlines. See Dkt. Nos. 11 63–64 (order extending deadline to join additional parties and file answer/counterclaims, and 12 shortening time to amend the pleadings); Dkt. No. 74 (order extending deadline to respond to

13 counterclaim by 30 days); Dkt. Nos. 76–77 (order extending deadline to respond to counterclaim 14 by an additional 21 days); Dkt. Nos. 106–07 (order extending deadline for Momcozy to respond 15 to this motion). 16 In August 2023, Elvie filed a counterclaim alleging willful patent infringement and breach 17 of contract under Washington law. Dkt. No. 69 at 26. Elvie asserted Momcozy’s S9, S9 Pro, S12, 18 S12 Pro, M1 and M5 products infringed the ’893 patent and a second patent (“the ’380 patent”). 19 Id. Elvie additionally stated it intended “to amend its Counterclaims to further assert infringement 20 of allowed Patent Application No. 17/203,292 (“the ’292 application”) upon its issuance by the 21 USPTO.” Id. at n.1. Elvie stated it “may also amend its Counterclaims to identify additional 22 products that infringe [the ’893 and ’380 patents], including Momcozy’s new V1 product.” Id. at

23 n.2. 24 1 On September 28, 2023, Elvie informed Momcozy it intended to amend its Counterclaims 2 to add the ’292 application, and a second allowed Patent Application, No. 18/148,864 (“the ’864 3 application”). Dkt. No. 101-3 at 2. The USPTO subsequently issued two patents to Elvie, U.S.

4 Patent No. 11,813,381 (“the ’381 patent” (previously the ’292 application)) and U.S. Patent No. 5 11,806,454 (“the ’454 patent” (previously the ’864 application)) in November 2023. Dkt. No. 101 6 at 3. 7 Elvie states it initially served interrogatories seeking information about Xitao on June 22, 8 2023. Dkt. No. 101 at 3. Momcozy responded by stating Xitao did not have a connection to the 9 products at issue. Id. Momcozy did not admit Xitao was a distributor of the products until January 10 19, 2024. Id. Momcozy admits to this oversight. Dkt. No. 108 at 4. 11 Elvie now moves to amend its counterclaims to add the two new patents (the ’381 and ’454 12 patents) and add Xitao as a counterclaim Defendant. Dkt. No. 101 at 2. Elvie seeks to assert the

13 ’381 patent against the Momcozy S9, S9 Pro, S12, and S12 Pro products. Id. Elvie seeks to assert 14 the ’454 patent against the Momcozy V1 and V2 products. Id. This amendment would bring the 15 total number of patents at issue to four, and the total number of products at issue to eight. 16 II. LEGAL STANDARD 17 Under Federal Rule of Civil Procedure 15(a)(2), a party may amend its pleading with the 18 Court’s leave. “In general, a court should liberally allow a party to amend its pleading.” Sonoma 19 Cnty. Ass’n of Retired Emps. v. Sonoma Cnty., 708 F.3d 1109, 1117 (9th Cir. 2013). “This 20 liberality in granting leave to amend is not dependent on whether the amendment will add causes 21 of action or parties.” DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 186 (9th Cir. 1987). The 22 Court “considers the following five factors to assess whether to grant leave to amend: (1) bad faith,

23 (2) undue delay, (3) prejudice to the opposing party, (4) futility of amendment and (5) whether 24 plaintiff has previously amended his complaint.” In re W. States Wholesale Nat. Gas Antitrust 1 Litig., 715 F.3d 716, 738 (9th Cir. 2013) (cleaned up), aff’d sub nom. Oneok, Inc. v. Learjet, Inc., 2 575 U.S. 373 (2015) (cleaned up). “[D]elay, by itself, is insufficient to justify denial of leave to 3 amend.” DCD Programs, 833 F.2d at 186. “Because leave is to be freely given when justice

4 requires, the burden is on the opposing party to demonstrate that justice requires denial.” Jones v. 5 Cate, No. 1:10-CV-00068 AWI, 2013 WL 1857769, at *2 (E.D. Cal. May 2, 2013). 6 III. ANALYSIS 7 Elvie argues the Court should grant its motion because this is the first time Elvie has sought 8 to amend its pleadings, the motion is timely filed, Elvie could not have included the newly asserted 9 patents or named Xitao at the time of its initial filing, and because Momcozy will not be prejudiced 10 by amendment. Dkt. No. 101 at 4. 11 Momcozy concedes it is not “irreconcilably opposed” to Elvie’s motion, but requests an 12 11-month extension of the trial date “to ensure that Momcozy is not unfairly prejudiced and that

13 critical claim construction issues are adequately presented to the Court.” Dkt. No. 108 at 3, 6. In 14 particular, Momcozy identifies the need for additional time to prepare its preliminary invalidity 15 contentions for the two new patents (id. at 6), and for Elvie to serve Xitao under international law 16 (id. at 2–3). Momcozy suggests Elvie has strategically delayed bringing this motion to amend. 17 Dkt. No. 108 at 7. 18 Thus, in essence, Momcozy opposes Elvie’s motion on the grounds that allowing 19 amendment would necessitate future delays in the case schedule, but the need for a future 20 continuance does not outweigh the directive that this court liberally grant leave for parties to amend 21 their pleadings when they timely seek to do so. For the following reasons, the Court finds that 22 Momcozy has not shown either that Elvie unduly delayed in moving for leave to amend, or that it

23 would be prejudiced by future modifications of the case schedule, and has therefore not met its 24 burden to show that the Court should deny leave to amend. 1 A. Elvie Did Not Unduly Delay Seeking Amendment. 2 Elvie states its motion for leave to amend, although timely under the current case schedule, 3 was delayed “due in part to Momcozy’s requests for extensions of time to consider Elvie’s

4 proposals, obtain new Washington counsel, accommodate travel and holiday schedules, etc.” Dkt. 5 No. 109 at 2 n.1. Elvie argues “[i]t is inequitable for Momcozy to take a substantial amount of 6 time to consider Elvie’s proposals and then use that delay as a shield[.]” Id. In addition, Elvie 7 states Momcozy “had notice of Elvie’s intent to include new patents when it negotiated the current 8 case schedule[,]” and that Momcozy “provided inaccurate information to Elvie in its verified 9 responses to Elvie’s interrogatories[,]” which delayed identification of the Xitao Momcozy entity. 10 Id. at 2. Elvie concedes it is willing to agree to an earlier date for the exchange of contentions “if 11 Momcozy’s concern is the interval between infringement contentions and trial[.]” Id. at 3. 12 Ultimately, Elvie argues the proper mechanism for Momcozy to request an extension of the case

13 schedule is not in an opposition to a motion to amend under Rule 15, but in a motion to amend the 14 case schedule under Rule 16. Id. at 2. 15 The Court agrees with Elvie that it did not unduly delay in filing its motion for leave to 16 amend. The record and the briefing on this motion demonstrate that Elvie forecast its intention to 17 amend its counterclaim in the manner it now requests. Elvie moved promptly for leave to amend 18 after the new patents were issued, and any delay is attributable to Momcozy providing admittedly 19 inaccurate information during the discovery process. Although Momcozy opposes Elvie’s motion 20 on grounds of delay, the Court finds that this factor does not support denying the motion. 21 B. Momcozy Will Not Be Prejudiced by Amendment. 22 In its opposition, Momcozy argues that it would be prejudiced by amendment because it

23 would need more time to prepare for trial and other pretrial deadlines. Dkt. No. 108 at 5–6. But 24 a continuance of the case schedule alone (assuming that one is needed) does not constitute 1 substantial prejudice that outweighs the need for amendment, particularly at this relatively early 2 stage in the proceedings. Cf. Solomon v. N. Am. Life & Cas. Ins. Co., 151 F.3d 1132, 1139 (9th 3 Cir. 1998) (affirming denial of leave to amend where amendment would require reopening

4 discovery). And to the extent that Momcozy raises concerns about the time Elvie will need to 5 serve Xitao under the Hague Convention (Dkt. No. 108 at 2–3), this concern is largely in 6 Momcozy’s control to remedy if it allows its current counsel to accept service for Xitao, as noted 7 by Elvie (Dkt. No. 109 at 4–5). In any event, modifications to the case schedule necessitated by 8 amendment may be addressed in a future motion to modify the case schedule, but the Court 9 declines to rule on that issue in the context of a motion for leave to amend. 10 Because Momcozy has not persuaded the Court that Elvie’s motion should be denied due 11 to either undue delay or prejudice, the Court will permit Elvie to amend its counterclaim. 12 //

13 // 14 15 16 17 18 19 20 21 22

23 24 1 IV. CONCLUSION 2 As explained herein, 3 1) Elvie’s motion to amend is GRANTED. Elvie shall file amended counterclaims and

4 accompanying exhibits no later than May 14, 2024. 5 2) The parties are ORDERED to meet and confer regarding modifications to the case 6 schedule necessitated by this amendment. Should the parties wish to propose moving 7 the trial date, they are directed to jointly contact the courtroom deputy, at 8 diyana_staples@wawd.courts.gov, to identify a date that is available on the Court’s 9 calendar. If the parties are not able to agree, either party may file a motion to modify 10 the schedule pursuant to Local Civil Rule 16(b)(6). 11 Dated this 30th day of April, 2024. 12 A 13 Kymberly K. Evanson 14 United States District Judge

15 16 17 18 19 20 21 22 23 24