Motiva Patents, LLC v. Sony Corp.

• Decision Date: 27 September 2019
• Docket Number: CIVIL ACTION NO. 9:18-CV-00180-JRG-KFG (Lead Case), CIVIL ACTION NO. 9:18-CV-00179-JRG-KFG (Member Case)
• Parties: MOTIVA PATENTS, LLC, Plaintiff, v. SONY CORPORATION, HTC Corporation, Defendants.
• Court: U.S. District Court — Eastern District of Texas

408 F.Supp.3d 819

MOTIVA PATENTS, LLC, Plaintiff,

v.SONY CORPORATION, HTC Corporation, Defendants.

CIVIL ACTION NO. 9:18-CV-00180-JRG-KFG (Lead Case)

CIVIL ACTION NO. 9:18-CV-00179-JRG-KFG (Member Case)

United States District Court, E.D. Texas, Lufkin Division.

Signed September 27, 2019

Matthew J Antonelli, Zachariah Harrington, Larry Dean Thompson, Jr, Michael David Ellis, Antonelli, Harrington & Thompson LLP, Houston, TX, Stafford Grigsby Helm Davis, Catherine Susan Bartles, The Stafford Davis Firm, PC, Tyler, TX, for Plaintiff.

Heidi Lyn Keefe, Azadeh Razi Morrison, Elizabeth L Stameshkin, Philip H Mao, Cooley LLP, Palo Alto, CA, Deron R Dacus, The Dacus Firm, PC, Tyler, TX, Dustin Michael Knight, Cooley LLP, Reston, VA, Eamonn Joseph Gardner, Cooley LLP, San Diego, CA, Fred Irvin Williams, Erik Chiles Shallman, Mario A. Apreotesi, Vinson & Elkins LLP, Austin, TX, Bobby Lamb, Harry Lee Gillam, Jr, Gillam & Smith, LLP, Marshall, TX, Todd Eric Landis, Vinson & Elkins LLP, Dallas, TX, for Defendants.

MEMORANDUM OPINION AND ORDER

RODNEY GILSTRAP, UNITED STATES DISTRICT JUDGE

Before the Court is the Motion to Dismiss Plaintiff's Original Complaint Under Rule 12(b)(6) ("the Motion to Dismiss") filed by Defendant HTC Corporation ("HTC"). (Dkt. No. 18). In the Motion to Dismiss, HTC argues that Plaintiff Motiva Patents, LLC ("Motiva") has failed to plead, with adequate specificity, a claim for indirect infringement and willful infringement. Having considered the Motion to Dismiss, and for the reasons set forth herein, the Court finds the Motion should be and hereby is DENIED.

I. Factual and Procedural Background

Motiva alleges that HTC directly, indirectly, and willfully infringes various claims of United States Patent Nos. 7,292,151 ("the '151 patent"), 7,952,483 ("the '483 patent"), 8,159,354 ("the '354 patent"), 8,427,325 ("the '325 patent"), or 9,427,659 ("the '659 patent") (collectively, the "Asserted Patents"). (Case No. 9:18-cv-179, Dkt. No. 1 at 16 ¶ 68) [hereinafter "Complaint"].¹ The Complaint alleges that Asserted Patents are broadly directed towards "systems, including video game systems, for tracking a user's movement, position, and/or orientation." (Id. at 2 ¶ 7).

Specifically, the [patented] systems include one or more hand-held transponders that are in communication with a processing system, such as a computer. Using sensors located on the transponder, such as gyroscopes and accelerometers, along with external sensors, the transponder's movement, position, and orientation are tracked and portrayed on a digital display. The transponder can also include buttons or other input mechanisms that enable the user to manipulate virtual objects in 3D.

(Id. ) Motiva alleges that various HTC products both directly and indirectly infringe the Asserted Patents. In addition to a general allegation that HTC sells infringing products, Motiva identifies a number of products that are specifically alleged to infringe the Asserted Patents, including HTC's "Vive, Vive Pro, and Vive BE Virtual Reality System (including, for example, the Controller(s), ‘Lighthouse’ Base Stations, Wireless Adapter, and/or Tracker(s) with accompanying peripherals) (‘Accused Vive Products’)." (Id. at 3 ¶ 10). Motiva's Complaint includes a short and plain statement explaining how the Accused Vive Products infringe the Asserted Patents. The Complaint specifically identifies the hardware involved in the Accused Vive Products that is accused of infringement. The Complaint recites:

64. The accused products include a first hand-held game controller comprised of an accelerometer, a transmitter that sends wireless signals to the remote processing system, a receiver that receives wireless signals from the remote processing system, a user input device on the exterior of the first hand-held game controller , an output device , a data storage memory , and a processing system in communication with the accelerometer, transmitter, receiver, user input device, output device, and data storage memory.

(Id. at 15 ¶ 64) (emphasis added). The Complaint also includes a description of the software processing system embodied in the Accused Vive Products, as well as the tasks performed by that software which are alleged to infringe. The Complaint recites:

65. The accused products include a processing system programmed with one or more software routines executing on the processing system to: 1) receive input relating to motion of the first hand-held game controller and provide data to the output device for outputting feedback based on the motion of the first hand-held game controller; 2) receive user input data from the user input device and, and in response to the user input data, output control data for communication to the remote processing system; 3) output data for communication to the remote processing system for controlling motion of a first virtual object displayed in a computer generated virtual environment displayed on a remote display and where the motion of the first virtual object is in proportion with the motion of the first hand-held game controller.

(Id. at 15 ¶ 65) (emphasis added). The Complaint further offers illustrative photographs of the Accused Vive Products to demonstrate how the accused features interact:

(Id. at 14).

Motiva includes a separate section addressed to its "allegations regarding indirect infringement." (Id. at 16). Motiva alleges indirect infringement under a theory of induced infringement and a theory of contributory infringement. (Id. at 16 ¶ 68; id. at 17 ¶ 70). For both theories of indirect infringement, the Complaint alleges pre-suit knowledge and post-suit knowledge of the Asserted Patents. Motiva relies on an allegation of willful blindness to demonstrate that HTC's knowledge of the Asserted Patents. The Complaint alleges that:

Defendant has a policy or practice of not reviewing the patents of others (including instructing its employees to not review the patents of others) , and thus has been willfully blind of Motiva's patent rights.

(Id. at 18 ¶ 72) (emphasis added). In addition, specific to post-suit knowledge, the Complaint alleges that HTC "has knowledge of the Asserted Patents at least as of the date when it was notified of the filing of this action." (Id. at 18 ¶ 71).

With respect to its theory of induced infringement, Motiva alleges that HTC took specific, affirmative, and intentional steps to induce infringement. The Complaint recites:

Defendant took active steps, directly and/or through contractual relationships with others , with the specific intent to cause them to use the accused products in a manner that infringes one or more claims of the patents-in-suit, including, for example, Claim 28 of the '151 Patent, Claim 44 of the '483 Patent, Claim 32 of the '354 Patent, Claim 1 of the '325 Patent, and Claim 45 of the '659 Patent. Such steps by Defendant included, among other things, advising or directing customers and end-users to use the accused products in an infringing manner; advertising and promoting the use of the accused products in an infringing manner; and/or distributing instructions that guide users to use the accused products in an infringing manner. Defendant is performing these steps, which constitute induced infringement with the knowledge of the Asserted Patents and with the knowledge that the induced acts constitute infringement. Defendant is aware that the normal and customary use of the accused products by Defendant's customers would infringe the Asserted Patent. Defendant's inducement is ongoing.

(Id. at 16 ¶ 68) (emphasis added); (see also id. at 16–17 ¶ 69).

Further, with respect to its theory of contributory infringement, Motiva alleges that HTC's products contain a software processing system specifically designed in a manner that has no substantial noninfringing uses. The Complaint alleges:

Defendant has also indirectly infringed by contributing to the infringement of the Asserted Patents. Defendant has contributed to the direct infringement of the Asserted Patents by the end-user of the accused products. The accused products have special features that are specially designed to be used in an infringing way and that have no substantial uses other than ones that infringe the Asserted Patents , including, for example, Claim 28 of the '151 Patent, Claim 44 of the '483 Patent, Claim 32 of the '354 Patent, Claim 1 of the '325 Patent, and Claim 45 of the '659 Patent. The special features include, for example, a processing system that receives wireless signals from a remote communication device and determines movement information for the remote communication device that is used in a manner that infringes the Asserted Patents. The special features constitute a material part of the invention of one or more of the claims of the Asserted Patents and are not staple articles of commerce suitable for substantial non-infringing use. Defendant's contributory infringement is ongoing.

(Id. at 17–18 ¶ 70) (emphasis added). Finally, Motiva alleges that HTC's infringement is willful. Motiva alleges that HTC's "direct and indirect infringement of the Asserted Patents is, has been, and continues to be willful, intentional, deliberate, and/or in conscious disregard of Motiva's rights under the patent." (Id. at 18 ¶ 74).

On December 17, 2018, HTC brought the present Motion to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6). HTC argues that Motiva has failed to allege adequate factual support for indirect infringement in three respects: HTC's knowledge of the Asserted Patents; HTC's intent to induce infringement; and the existence of substantial noninfringing uses for HTC's products. HTC also claims that Motiva has failed to plead adequate factual support for willful infringement. Accordingly, HTC asks the Court to dismiss Motiva's "both pre- and post-suit" claims for induced, contributory, and willful infringement. (Dkt. No. 18 at 10, 12, 13).

II. Legal Standard

A. Motion to Dismiss

This Court applies Fifth Circuit law to the...