Ni-Q, LLC v. Prolacta Bioscience, Inc., Case No. 3:17-cv-934-SI
| Decision Date | 20 September 2019 |
| Docket Number | Case No. 3:17-cv-934-SI |
| Citation | 407 F.Supp.3d 1153 |
| Parties | NI-Q, LLC, Plaintiff, v. PROLACTA BIOSCIENCE, INC., Defendant. |
| Court | U.S. District Court — District of Oregon |
Brenna K. Legaard and Angela E. Addae, Schwabe, Williamson & Wyatt PC, 1211 SW Fifth Avenue, Suite 1900, Portland, OR 97204. Of Attorneys for Plaintiff.
Kristin L. Cleveland, Klarkquist Sparkman LLP, 121 SW Salmon Street, Suite 1600, Portland, OR 97204; Orion Armon, Cooley LLP, 380 Interlocken Crescent, Suite 900, Broomfield, CO 80021; Alexandra Mayhugh, Cooley LLP, 1333 2nd Street, Suite 400, Santa Monica, CA 90401; Nicholas G. Lockhart, Cooley LLP, 1299 Pennsylvania Avenue, NW, Suite 700, Washington, DC 20004. Of Attorneys for Defendant.
In this action brought by Plaintiff Ni-Q, LLC ("Ni-Q") against Defendant Prolacta Bioscience, Inc. ("Prolacta"), Ni-Q seeks a declaratory judgment of non-infringement and invalidity of U.S. Patent No. 8,628,921 ("the '921 patent"), and contends that Prolacta violated Oregon's Unlawful Trade Practices Act. Ni-Q also asserts an affirmative defense of inequitable conduct, alleging that Prolacta engaged in fraud on the U.S. Patent and Trademark Office ("PTO") in obtaining the '921 patent, among other patents. The Court granted Ni-Q's motion for summary judgment, finding that certain claims of the '921 patent were invalid under 35 U.S.C. § 101 and that even if they were not invalid, Ni-Q did not infringe the patent as a matter of law. Before the Court is Ni-Q's motion for leave to file a second amended complaint to add a new claim alleging a violation of the Sherman Antitrust Act. Also before the Court is Ni-Q's motion for summary judgment, arguing that the claims of the '921 patent are invalid as anticipated under 35 U.S.C. § 102(b) (pre-AIA).
Rule 15(a)(2) of the Federal Rule of Civil Procedure provides that the "court should freely give leave [to amend a pleading] when justice so requires." A district court should apply Rule 15's "policy of favoring amendments ... with extreme liberality." Price v. Kramer , 200 F.3d 1237, 1250 (9th Cir. 2000) (quotation marks omitted). The purpose of the rule "is ‘to facilitate decision on the merits, rather than on the pleadings or technicalities.’ " Novak v. United States , 795 F.3d 1012, 1020 (9th Cir. 2015) (quoting Chudacoff v. Univ. Med. Ctr. , 649 F.3d 1143, 1152 (9th Cir. 2011) ). A district court, however, may, within its discretion, deny a motion to amend "due to undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [and] futility of the amendment." Zucco Partners, LLC v. Digimarc Corp. , 552 F.3d 981, 1007 (9th Cir. 2009) (alteration in original) (quoting Leadsinger, Inc. v. BMG Music Publ'g , 512 F.3d 522, 532 (9th Cir. 2008) ). Eminence Capital, LLC v. Aspeon, Inc. , 316 F.3d 1048, 1052 (9th Cir. 2003). Futility of amendment, however, "can, by itself, justify the denial of a motion for leave to amend." Bonin v. Calderon , 59 F.3d 815, 845 (9th Cir. 1995). Generally, however, "[a]bsent prejudice, or a strong showing of any of the remaining [four] factors, there exists a presumption under Rule 15(a) in favor of granting leave to amend." Eminence Capital , 316 F.3d at 1052 (alterations added, emphasis in original). When weighing the factors, all inferences should be made in favor of granting the motion to amend. Griggs v. Pace Am. Grp., Inc. , 170 F.3d 877, 880 (9th Cir. 1999).
A party is entitled to summary judgment if the "movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). The moving party has the burden of establishing the absence of a genuine dispute of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The court must view the evidence in the light most favorable to the non-movant and draw all reasonable inferences in the non-movant's favor. Clicks Billiards Inc. v. Sixshooters Inc. , 251 F.3d 1252, 1257 (9th Cir. 2001). Although "[c]redibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge ... ruling on a motion for summary judgment," the "mere existence of a scintilla of evidence in support of the plaintiff's position [is] insufficient ...." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 252, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (citation and quotation marks omitted).
Prolacta argues that Ni-Q's motion to amend should be denied because it is futile, Ni-Q unduly delayed in bringing the motion, and Ni-Q already amended its complaint once before. The mere fact that Ni-Q previously amended its complaint one time, however, does not support denying the motion. Ni-Q amended its complaint in August 2017, about one year before Ni-Q asserts that it became aware of the facts supporting its allegations of Prolacta's fraud on the PTO. Thus, Ni-Q could not have asserted the proposed antitrust claim when it previously amended its complaint. Ni-Q therefore has not had an opportunity to cure defects and did not in that previous amendment or had the opportunity to bring this new claim and did not in that previous amendment. Accordingly, this factor does not support denying the motion.1
Leave to amend may be denied if the proposed amendment is futile or would be subject to immediate dismissal. Carrico v. City & Cty. of San Francisco , 656 F.3d 1002, 1008 (9th Cir. 2011). An amendment is futile "only if no set of facts can be proved under the amendment to the pleadings that would constitute a valid and sufficient claim or defense.’ " Barahona v. Union Pac. R.R. Co. , 881 F.3d 1122, 1134 (9th Cir. 2018) (quoting Sweaney v. Ada Cty. , 119 F.3d 1385, 1393 (9th Cir. 1997) ); see also Missouri ex rel. Koster v. Harris , 847 F.3d 646, 656 (9th Cir. 2017) . If the underlying facts or circumstances possibly could "be a proper subject of relief, [a plaintiff] ought to be afforded an opportunity to test his claim on the merits." Foman v. Davis , 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962). The standard for assessing whether a proposed amendment is futile therefore is the same as the standard imposed under Rule 12(b)(6) of the Federal Rules of Civil Procedure, see, e.g. , Miller , 845 F.2d at 214, although "viewed through the lens of the requirement that courts freely give leave to amend when justice so requires." Barber v. Select Rehab., LLC , 2019 WL 2028519, *1 (D. Or. May 8, 2019).
Prolacta argues that allowing the amendment is futile because Ni-Q does not assert sufficient facts in its proposed amendment demonstrating that Prolacta has willfully acquired or maintained monopoly power or has injured competition, and that Ni-Q fails to allege a reasonably defined market. In considering futility, the Court does not simply consider the facts alleged, but also considers whether there may be "additional allegations that are ‘consistent with the challenged pleading’ and that do not contradict the allegations in the original complaint" that would support Ni-Q's new claim. United States v. Corinthian Colleges , 655 F.3d 984, 995 (9th Cir. 2011) (quoting Krainski v. Nev. ex rel. Bd. of Regents of Nev. System of Higher Educ. , 616 F.3d 963, 972 (9th Cir. 2010) ); see also Quest Integrity USA, LLC v. A.Hak Indus. Servs. US, LLC , 2016 WL 4533067, at *2 (W.D. Wash. Apr. 8, 2016) ( ).
Ni-Q argues that its allegations are sufficient to allege attempted monopolization under 15 U.S.C. § 2 through a Walker Process fraud claim.2 "The traditional claim for attempted monopolization occurs when danger of monopolization is clear and present, but before a full-blown monopolization has necessarily been accomplished." Alaska Airlines, Inc. v. United Airlines, Inc. , 948 F.2d 536, 541-42 (9th Cir. 1991). "[T]o demonstrate attempted monopolization a plaintiff must prove (1) that the defendant has engaged in predatory or anticompetitive conduct with (2) a specific intent to monopolize and (3) a dangerous probability of achieving monopoly power."
Spectrum Sports, Inc. v. McQuillan , 506 U.S. 447, 456, 113 S.Ct. 884, 122 L.Ed.2d 247 (1993). For a Walker Process monopolization or attempted monopolization claim, a court must "appraise the exclusionary power of the illegal patent claim in terms of the relevant market for the product involved" in order to measure the defendant's "ability to lessen or destroy competition." Id. (quoting Walker Process , 382 U.S. at 177, 86 S.Ct. 347.
The relevant market as defined by Ni-Q is "the market for breast milk having standardized macronutrient content within the US." The relevant market consists of all...
To continue reading
Request your trial