Zond, Inc. v. Fujitsu Semiconductor Ltd.

990 F. Supp. 2d 50, 2014 WL 69035, 2014 U.S. Dist. LEXIS 2439
CourtDistrict Court, D. Massachusetts
DecidedJanuary 9, 2014
DocketCivil Action No. 13-11634-WGY
StatusPublished
Cited by16 cases

This text of 990 F. Supp. 2d 50 (Zond, Inc. v. Fujitsu Semiconductor Ltd.) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Zond, Inc. v. Fujitsu Semiconductor Ltd., 990 F. Supp. 2d 50, 2014 WL 69035, 2014 U.S. Dist. LEXIS 2439 (D. Mass. 2014).

Opinion

MEMORANDUM AND ORDER

YOUNG, District Judge.

At a motion session on November 26, 2013, this Court heard two motions regarding Zond, Inc.’s (“Zond”) second amended complaint for patent infringement. Second Am. Compl. Patent Infringement (“2nd. Am. Compl.”), ECF No. 19. The Court heard a joint motion to dismiss, filed by Fujitsu Semiconductor Ltd. (“Fujitsu Ltd.”) and Fujitsu Semiconductor America, Inc., (“Fujitsu USA”) (jointly, “Fujitsu”), and a joint motion to dismiss filed by Taiwan Semiconductor Manufacturing Company, Ltd., TSMC North America Corporation, TSMC Development, Inc., and Wafertech, LLC (jointly, “TSMC”).1 Fujitsu Semiconductor Ltd., & Fujitsu Semiconductor America, Inc.’s Mot. Dismiss (“Fujitsu’s Mot. Dismiss”), ECF No. 26; Mot. Dismiss Defs. Taiwan Semiconductor Mfg. Co. Ltd., TSMC North America Corp., TSMC Development, Inc., & Wafertech, LLC (“TSMC’s Mot. Dismiss”), ECF No. 32. After hearing counsel on these motions the Court entered an order dismissing, without prejudice, Zond’s willful infringement claims against all defendants, but otherwise denied TSMC’s motion to dismiss, and took under advisement Fujitsu’s motion. Elec. Clerk’s Notes, ECF No. 48.

Having had the opportunity further to consider Fujitsu’s motion to dismiss, for the reasons stated below, this Court GRANTS Fujitsu’s motion insofar as Zond seeks to recover for alleged pre-filing knowledge, but otherwise DENIES their motion

I. ANALYSIS

Federal Rule of Civil Procedure 8(a) (“Rule 8(a)”) requires the plaintiff state a claim upon which relief can be granted. See Fed.R.Civ.P. 8(a)(2). For the reasons [53]*53articulated below, Zond has — -just barely— met this requirement.

A. Improper Group Pleading

Fujitsu argues that Zond’s decision to treat Fujitsu Ltd. and Fujitsu USA as an “undifferentiated mass” and to make all allegations against the group as a whole fails to notify the separate defendants of the specific allegations against them. Fujitsu Semiconductor Ltd. & Fujitsu Semiconductor America, Inc.’s Mem. Law Supp. Their Mot. Dismiss (“Fujitsu Mem. Supp. Mot.”) 5, 7-8, ECF No. 27; Fujitsu Semiconductor Ltd. & Fujitsu Semiconductor America, Inc.’s Reply Mem. Law Supp. Their Mot. Dismiss (“Fujitsu Reply Mem. Supp. Mot.”) 2, ECF-No. 38.

Whilst a pleading, group or otherwise, must be sufficiently clear to put the defendants on notice as to “who did what to whom, when, where and why”, Educadores Puertorriqueños en Acción v. Hernández, 367 F.3d 61, 68 (1st Cir.2004), group pleadings are not, prima facie, excluded by Rule 8(a). At the motion to dismiss stage a complaint generally will only be dismissed where it is “entirely implausible” or impossible for the grouped defendants to have acted as alleged. GMO Trust ex rel. GMO Emerging Country Debt Fund v. ICAP plc, No. 12-10293-DPW, 2012 WL 5197545, at *8 (D.Mass. Oct. 18, 2012) (Woodlock J.); see also Automated Transaction LLC v. New York Cmty. Bank, No. 12-CV-3070 (JS)(ARL), 2013 WL 992423, at *4 (E.D.N.Y. Mar. 13, 2013) (“each defendant [must have] fair notice of the claims against it” (quoting Holmes v. Allstate Corp., No. 11-CV1543 (LTS)(DF), 2012 WL 627238, at *22 (S.D.N.Y. Jan. 27, 2012) report and recommendation adopted, 11-CIV-1543 (LTSXDCF), 2012 WL 626262 (S.D.N.Y. Feb. 27, 2012), appeal dismissed (Apr. 23, 2012))).

Zond alleges that “Fujitsu” is directly infringing, willfully infringing, and inducing the infringement of, the patents-in-suit. See generally 2nd Am. Compl. These allegations, as made in the filed second amended complaint, are facially plausible — it is not impossible for both Fujitsu USA and Fujitsu Ltd. to have engaged in each of the acts alleged by Zond. Though it may be a stretch for the court to infer that “both parent [Fujitsu Ltd.] and subsidiary [Fujitsu USA] ‘design[ ] and develop[ ] ... [the same] semiconductor products’ made by Taiwan-based TSMC,” Fujitsu Reply Mem. Supp. Mot. 3 (third, fourth, and fifth alterations original), and it is not for the Court to evaluate, at this stage, whether the plaintiff will be able to obtain the necessary evidence to prove its claims. See Hague v. Massachusetts Dep’t of Elementary & Secondary Educ., Nos. 10-30138 DJC, 10-30142 DJC, 10-30143 DJC, 10-30144 DJC, 2011 WL 4073000, at *3 (D.Mass. Sept. 12, 2011) (Casper, J.). Furthermore, determining the exact operations of the Fujitsu corporate group, and thus the relevant assignment of potential liability, requires corporate structure information that is not readily available to the public. It would seem illogical to allow Fujitsu potentially to escape liability because of its ability to keep its corporate structure confidential.

Further, despite making all allegations in the second amended complaint against the Fujitsu corporate group, Zond provides each individual defendant with fair notice of each claim alleged against it. Unlike in Automated Transaction, where the plaintiff did not consistently group the defendants together when making allegations, 2013 WL 992423, at *4, the consistency of the subject of the pleading in this case, despite its group format, means that it can be reasonably inferred that each and [54]*54every allegation is made against each individual defendant.

B. Direct Infringement 35 U.S.C. Section 271(g)

Pursuant to Federal Rule of Civil Procedure 8(a)(2) (“Rule 8(a)(2)”) a pleading must contain a “short and plain statement of the claim showing that the pleader is entitled to relief’. Fed.R.Civ.P. 8(a)(2). Fujitsu states that for a claim to satisfy Rule 8(a)(2) it must be plead in accordance with the standard outlined in Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), and Zond’s claim of direct infringement fails to meet this standard. Fujitsu Mem. Supp. Mot. 4-5. Zond, however, contends that a direct infringement complaint will be adequately plead where it meets the requirements of Form 18 of the Federal Rules of Civil Procedure (“Form 18”). PI. Zond’s Opp’n. Fujitsu Semiconductor Ltd. & Fujitsu Semiconductor America, Inc.’s Mot. Dismiss (“Reply”) 6, ECF No. 35. This Court, in accordance with the case law, concludes that the correct pleading standard for a direct infringement claim is, as argued by Zond, that demonstrated by Form 18.

The standard required by Form 18 cannot be easily reconciled with the judgments of the Supreme Court in both Twombly and Iqbal. See e.g., Tyco Fire Prods. LP v. Victaulic Co.,

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990 F. Supp. 2d 50, 2014 WL 69035, 2014 U.S. Dist. LEXIS 2439, Counsel Stack Legal Research, https://law.counselstack.com/opinion/zond-inc-v-fujitsu-semiconductor-ltd-mad-2014.