Wizards of the Coast LLC v. Cryptozoic Entertainment LLC

309 F.R.D. 645, 2015 U.S. Dist. LEXIS 102031, 2015 WL 4641714
CourtDistrict Court, W.D. Washington
DecidedAugust 4, 2015
DocketCase No. C14-0719JLR
StatusPublished
Cited by74 cases

This text of 309 F.R.D. 645 (Wizards of the Coast LLC v. Cryptozoic Entertainment LLC) is published on Counsel Stack Legal Research, covering District Court, W.D. Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Wizards of the Coast LLC v. Cryptozoic Entertainment LLC, 309 F.R.D. 645, 2015 U.S. Dist. LEXIS 102031, 2015 WL 4641714 (W.D. Wash. 2015).

Opinion

ORDER ON PLAINTIFF’S MOTIONS FOR LEAVE TO AMEND

JAMES L. ROBART, District Judge.

I. INTRODUCTION

Before the court are Plaintiff Wizards of the Coast LLC’s (“Wizards”) motion for [648]*648leave to amend its preliminary infringement contentions (1st Mot.(Dkt. # 41)) and motion for leave to file a second amended complaint (2d Mot.(Dkt. # 65)). These motions seek to add to this case theories of contributory patent infringement and inducement of patent infringement. The court has considered the motions, all submissions filed in support thereof and opposition thereto, the balance of the record, and the relevant law. Being fully advised,1 the court GRANTS both motions for the reasons set forth below.

II. BACKGROUND

This is a patent infringement case involving trading card games. Plaintiff Wizards of the Coast LLC (“Wizards”) is the assignee of now-expired United States Patent No. RE 37'957 (“the '957 Patent”), which relates to Wizards’ trading card game, “Magic: The Gathering” (“Magic”). (See Patent (Dkt. #61-1).) Wizards alleges that Defendants Cryptozoic Entertainment LLC and Hex Entertainment LLC (collectively “Defendants”) infringed its patent rights with their accused game — “Hex: Shards of Fate” (“Shards of Fate”) — before the '957 Patent expired on June 22, 2014. (See Wiz. Op. Cl. Const. Br. (Dkt. # 60) at 3.)

On May 14, 2014, Wizards filed its initial complaint against Defendants, alleging patent infringement and other claims not at issue here. (See Compl. (Dkt. # 1).) Defendants responded on July 15, 2014, with a motion to dismiss directed to a non-patent claim and the issue of personal jurisdiction. (See MTD (Dkt. # 11) at 8,13, 14.) Wizards then filed its first amended complaint (“FAC”) on August 1, 2014 (see FAC (Dkt. # 13)), after which Defendants withdrew their motion to dismiss (see Dkt. # 17). On August 29, 2014, Defendants filed their answers. (See Ans. (Dkt. ## 23, 24).)

As noted above, the present dispute concerns the potential addition of theories of indirect patent infringement — that is, contributory infringement and inducement of infringement. (See 1st Mot. at 1; 2d Mot. at 1; Resp. to 1st Mot. (Dkt. # 43) at 6; Resp. to 2d Mot. (Dkt. #70) at 2.) Although the FAC alleges only direct infringement (see FAC ¶¶ 90-95), by at least January 28, 2011, the parties discussed whether indirect infringement would also be part of the case (see 2d Lorbiecki Decl. (Dkt. #47) ¶¶4-6). The issue arose as the parties debated whether Wizards was entitled to a list of Defendants’ subscribers. (See id.) Wizards offered to accept a list that showed only the number of subscribers, provided Defendants agreed not to rely on the distinction between direct and indirect infringement in defending against Wizards’ patent claims. (See id.) Wizards insisted, however, that if Defendants would not so agree, it would require a full list to prepare a case for indirect infringement. (See id.; see also id. ¶¶ 11-12, Exs. B-C.) In hopes of resolving this dispute, Wizards proposed a stipulation that would collapse the distinction between direct and indirect infringement. (See id. ¶¶ 4-6.) After this initial January 28 discussion, counsel for Wizards understood that the parties would collaborate on a stipulation. (See id.)

On January 30, 2015, Wizards served its preliminary infringement contentions (“PICs”) in compliance with the court’s scheduling order. (See id. ¶¶ 7-8; 1st Lor-biecki Decl. (Dkt. #42) ¶3, Ex. A (“PICs”); Sched. Ord. (Dkt. # 38) at 1); see also Local Rules W.D. Wash. LPR 120. The PICs referenced only direct infringement. (See PICs.) Counsel for Wizards asserts that within the next few days he became concerned that he still had not received a stipulation from Defendants and, therefore, on February 3, 2015, he sent Defendants revised PICs that included contentions of indirect infringement. (2d Lorbiecki Decl. ¶ 10; see 1st Lorbiecki Decl. ¶ 3, Ex. B.) Over the next week, the parties exchanged several emails regarding the proposed stipulation. (See 2d Lorbiecki Decl. ¶¶ 11-13, 15-16, Exs. B-F; see also id. ¶ 9 (discussing a February 2, 2015, phone conversation in which Defendants’ counsel stated that they were working on the stipulation).) For example, on February 9, 2015, Defendants’ counsel sent an [649]*649email to Wizards’ counsel stating that “we are pursuing a stipulation as you suggested in your email” and “will pursue it with the client once we arrive with something that we think is acceptable.” (Id. ¶ 15, Ex. E.) On February 27, Defendants served their non-infringement and invalidity contentions in which they objected to Wizards’ revised PICs (see id. ¶ 14; 1st Lorbiecki Deck ¶ 9 Ex. D); however, there is no indication in the record that Defendants ever informed Wizards that they were no longer considering the proposed stipulation.

On April 2, 2015, Wizards filed the instant motion for leave to amend its PICs to include contentions of indirect infringement. (See 1st Mot.) Defendants filed an opposition in which they urge the court to reject Wizards’ request because the FAC lacks allegations of indirect infringement; Wizards was not diligent in disclosing its contentions of indirect infringement; and allowing amendment would prejudice Defendants. (See Resp. to 1st Mot.) On June 22, 2015, the court entered an order deferring ruling on the motion and giving Wizards until July 2, 2015, to formally move for leave to amend its complaint to add allegations of indirect infringement. (See 6/22/15 Order (Dkt. # 64).)

On July 2, 2015, Wizards timely filed the instant motion for leave to amend its complaint to include allegations of indirect infringement. (See 2d Mot.; see also Prop.2d Am. Comph (Dkt. # 66-1).) Defendants oppose this motion as well,2 arguing that Wizards unduly delayed bringing the motion, amendment would prejudice Defendants, and Wizards is acting in bad faith. (See Resp. to 2d Mot.) Wizards’ motions to amend are now before the court.

III. DISCUSSION

A. Legal Standards

Wizards’ motions implicate both Federal Rule of Civil Procedure 15 and Local Patent Rule 124. Rule 15 governs amendments to pleadings. It provides that, after an initial period for amendments as of right, pleadings may be amended only with the opposing party’s written consent or by leave of the court. Fed.R.Civ.P. 15(a). Generally, “the court should freely give leave [to amend pleadings] when justice so requires.” Fed. R.Civ.P. 15(a)(2). This rule should be interpreted and applied with “extreme liberality.” Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir.1990). Federal policy favors freely allowing amendment so that eases may be decided on their merits. See Martinez v. Newport Beach City, 125 F.3d 777

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309 F.R.D. 645, 2015 U.S. Dist. LEXIS 102031, 2015 WL 4641714, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wizards-of-the-coast-llc-v-cryptozoic-entertainment-llc-wawd-2015.