Bell Semiconductor, LLC v. NXP U.S, Inc.

• Decision Date: 27 January 2023
• Docket Number: 22-cv-01794-H-KSC,22-cv-00594-H-KSC
• Parties: BELL SEMICONDUCTOR, LLC, Plaintiff, v. NXP USA, INC., Defendant.
• Court: U.S. District Court — Southern District of California

BELL SEMICONDUCTOR, LLC, Plaintiff,
v.
NXP USA, INC., Defendant.

Nos. 22-cv-01794-H-KSC, 22-cv-00594-H-KSC

United States District Court, S.D. California

January 27, 2023

ORDER DENYING DEFENDANT NXP'S RULE 12(b)(6) MOTION TO DISMISS

[Doc. No. 15.] ^[1]

MARILYN L. HUFF, DISTRICT JUDGE UNITED STATES DISTRICT COURT

On December 29, 2022, Defendant NXP USA, Inc. (“NXP”) filed a motion to dismiss Plaintiff Bell Semiconductor, LLC (“Bell Semic”)'s complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. (Doc. No. 15.) On January 13, 2023, Bell Semic filed a response in opposition to NXP's motion to dismiss. (Case No. 22-cv-594, Doc. No. 93.) On January 23, 2023, NXP filed a reply. (Case No. 22-cv-594, Doc. No. 99.) On January 25, 2023, the Court took the matter under submission. (Doc. No. 24.) For the reasons below, the Court denies NXP's motion to dismiss.

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Background

Bell Semic alleges that it is the owner by assignment of U.S. Patent No. 7,396,760 (“the '760 Patent”). (Doc. No. 1, Compl. ¶ 24.) In the present action, Bell Semic alleges that NXP directly infringes, either literally or under the doctrine of equivalents, the '760 Patent by using the circuit design methodologies claimed in the patent to design one or more semiconductor devices, including for example its NXP LS1043A Quad-Core Networking Processor devices. (Id. ¶¶ 1, 38-43.)

The '760 Patent generally relates to features of semiconductor design and manufacturing. The '760 Patent is entitled “method and system for reducing inter-layer capacitance in integrated circuits” and was issued on July 8, 2008. U.S. Patent No. 7,396,760, at [45], [54] (issued Jul. 8, 2008). The invention disclosed in the '760 Patent “provides a method and system for reducing inter-layer capacitance utilizing an intelligent dummy filling placement in integrated circuits.” Id. col. 2 ll. 17-19.

Independent claim 1 of the '760 Patent claims:

A method for placing dummy fill patterns in an integrated circuit fabrication process, comprising:

obtaining layout information of the integrated circuit, the integrated circuit including a plurality of layers

obtaining a first dummy fill space for a first layer based on the layout information

obtaining a second dummy fill space for a second layer, the second layer being placed successively to the first layer

determining an overlap between the first dummy fill space and the second dummy fill space; and minimizing the overlap by re-arranging a plurality of first dummy fill features and a plurality of second dummy fill features,

wherein the first dummy fill space includes non-signal carrying lines on the first layer and the second dummy fill space includes non-signal carrying lines on the second layer.

Id. col. 6 ll. 8-24.

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On November 15, 2022, Bell Semic filed a complaint against NXP, alleging a claim for infringement of the '760 Patent. (Doc. No. 1, Compl. ¶¶ 34-46.) On January 12, 2023, the Court denied NXP's motion to stay this action. (Doc. No. 20 at 10.) On January 12, 2023, the Court consolidated this action with Bell Semiconductor v. NXP USA, Inc., No. 22-cv-594 (S.D. Cal, filed Apr. 27, 2022), and several other related actions for pretrial purposes. (Doc. No. 21 at 5.) By the present motion, NXP moves pursuant to Federal Rule of Civil Procedure 12(b)(6) to dismiss Bell Semic's complaint for failure to state a claim. (Doc. No. 15-1 at 1.)

Discussion

I. Legal Standards for a Rule 12(b)(6) Motion to Dismiss

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of the pleadings and allows a court to dismiss a complaint if the plaintiff has failed to state a claim upon which relief can be granted. See Conservation Force v. Salazar, 646 F.3d 1240, 1241 (9th Cir. 2011) (citing Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)). Federal Rule of Civil Procedure 8(a)(2) requires that a pleading that states a claim for relief contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” The function of this pleading requirement is to “‘give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.'” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).

A complaint will survive a Rule 12(b)(6) motion to dismiss if it contains “enough facts to state a claim to relief that is plausible on its face.” Id. at 570. “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “A pleading that offers ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action will not do.'” Id. (quoting Twombly, 550 U.S. at 555). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. “While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.”

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Id. at 679. Accordingly, dismissal for failure to state a claim is proper where the claim “lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008); see Los Angeles Lakers, Inc. v. Fed. Ins. Co., 869 F.3d 795, 800 (9th Cir. 2017).

In reviewing a Rule 12(b)(6) motion to dismiss, a district court must “‘accept the factual allegations of the complaint as true and construe them in the light most favorable to the plaintiff.'” Los Angeles Lakers, 869 F.3d at 800 (quoting AE ex rel. Hernandez v. Cty. of Tulare, 666 F.3d 631, 636 (9th Cir. 2012)). But a court need not accept “legal conclusions” as true. Iqbal, 556 U.S. at 678. Further, it is improper for a court to assume the claimant “can prove facts which it has not alleged or that the defendants have violated the . . . laws in ways that have not been alleged.” Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 526 (1983).

In addition, a court may consider documents incorporated into the complaint by reference and items that are proper subjects of judicial notice. See Coto Settlement v. Eisenberg, 593 F.3d 1031, 1038 (9th Cir. 2010). If the court dismisses a complaint for failure to state a claim, it must then determine whether to grant leave to amend. See Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995); Telesaurus VPC, LLC v. Power, 623 F.3d 998, 1003 (9th Cir. 2010).

II. Analysis of Plaintiff's Claim for Infringement of the '760 Patent

In the complaint, Bell Semic alleges against NXP a claim for infringement of the '760 Patent. (Doc. No. 1, Compl. ¶¶ 34-46.) NXP argues that Bell Semic's claim for infringement of the '760 Patent should be dismissed for two reasons. First, NXP argues that the claim should be dismissed because the asserted claims of '760 Patent are invalid under 35 U.S.C. § 101. (Doc. No. 15-1 at 3-16.) Second, NXP argues that the claim should be dismissed because Bell Semic has failed to allege sufficient facts to state a plausible claim for infringement of the '760 Patent. (Id. at 16-20.) The Court addresses these two grounds for dismissal in turn below.

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A. NXP's § 101 Challenge to the Validity of the '760 Patent

i. Legal Standards Governing Patent Eligibility Under 35 U.S.C. § 101

Section 101 of the Patent Act defines patent-eligible subject matter as “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” 35 U.S.C. § 101. The Supreme Court has “‘long held that this provision contains an important implicit exception[:] Laws of nature, natural phenomena, and abstract ideas are not patentable.'” Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013) (quoting Mayo Collaborative Servs. v. Prometheus Lab'ys, Inc., 566 U.S. 66, 70 (2012)). “This exception reflects the concern that patent law not inhibit further discovery by improperly tying up the future use of these building blocks of human ingenuity.” PersonalWeb Techs. LLC v. Google LLC, 8 F.4th 1310, 1314 (Fed. Cir. 2021) (internal quotation marks omitted) (quoting Alice Corp. v. CLS Bank Int'l, 573 U.S. 208, 216 (2014)); see also CareDx, Inc. v. Natera, Inc., 40 F.4th 1371, 1376 (Fed. Cir. 2022) (“These exceptions exist because monopolizing the basic tools of scientific work ‘might tend to impede innovation more than it would tend to promote it.'” (quoting Mayo, 566 U.S. at 71)).

“The Supreme Court has established a two-step framework for evaluating patent eligibility under § 101.” Int'l Bus. Machines Corp. v. Zillow Grp., Inc., 50 F.4th 1371, 1377 (Fed. Cir. 2022) (citing Alice, 573 U.S. at 217). Under step one, the court “determine[s] whether the claim is ‘directed to' a ‘patent-ineligible concept,' such as an abstract idea.” Coop. Ent., Inc. v. Kollective Tech., Inc., 50 F.4th 127, 130 (Fed. Cir. 2022) (quoting Alice, 573 U.S. at 217). If so, the court proceeds to step two and “examine[s] ‘the elements of the claim to determine whether it contains an “inventive concept” sufficient to “transform” the claimed abstract idea into a patent-eligible application.'” Id. (quoting Alice, 573 U.S. at 221). Specifically, the court determines “whether the claim elements, individually and as an ordered combination, contain an inventive concept, which is more than merely implementing an abstract idea using ‘well-understood, routine, [and] conventional activities previously known to the industry.'” Id. (quoting Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat'l Ass'n,

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776 F.3d 1343, 1347-48 (Fed. Cir. 2014)).

“Patent eligibility is a question of law that may involve underlying questions of fact. PersonalWeb, 8 F.4th at 1314; see ...