Opinion
Civil No. 1:01CV00957
July 3, 2002
MEMORANDUM OPINION
Plaintiff, Bernhardt L.L.C. ("Plaintiff"), filed a complaint against Defendant, Collezione Europa USA, Inc. ("Defendant"), alleging that Defendant infringed upon several of Plaintiff's patents. Along with its answer, Defendant filed counterclaims against Plaintiff.
This action is presently before the court on Plaintiff's motion to dismiss Defendant's counterclaims. For the following reasons, the court will grant in part and deny in part Plaintiff's motion to dismiss Defendant's counterclaims.
FACTS
Plaintiff is a North Carolina limited liability company that owns six design patents covering furniture pieces that are part of a suite of furniture sold by Plaintiff's licensee under the name "the Coronado Collection." Each of the six design patents protects the ornamental design of an individual piece of furniture in the Coronado Collection. The respective numbers of the design patents are as follows: D438, 727 (the "`727 patent") D439, 770 (the "`770 patent"); D439, 763 (the "`763 patent"); D441, 560 (the "`560 patent"); D441, 975 (the "`975 patent"); and 0441, 980 (the "`980 patent") (collectively the "Coronado Patents")
Defendant is a New Jersey corporation that produces furniture "knock-offs." Defendant has its own furniture designers, but a significant portion of its product lines is derived from the designs of others. Defendant searches the furniture market for designs created by other companies that Defendant believes will sell. If Defendant can create a similar design and produce the product below the retailers' cost of the original, it will do so. In the furniture industry, this is called "knocking off" the design of another. As long as the product designs that Defendant replicates are not covered by a valid design patent or other legal protection, this practice does not violate the law. Arguably, it provides a valuable service to the buying public by ensuring competitive prices. If the replicated designs are patent protected, however, Defendant may be liable for patent infringement.
Plaintiff believes that Defendant has infringed, and is presently infringing, the Coronado Patents by manufacturing, importing, and selling pieces of furniture that are confusingly similar to the ornamental designs protected by the Coronado Patents. Plaintiff filed a complaint against Defendant alleging patent infringement and seeking monetary and injunctive relief against Defendant. Defendant responded to Plaintiff's complaint by filing an answer and asserting against Plaintiff two counterclaims. Pursuant to Federal Rule of Civil Procedure 12(b)(6), Defendant has filed a motion to dismiss Plaintiff's counterclaims for failure to state a claim upon which relief may be granted.
DISCUSSION
A court may dismiss a claim for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) only if "it appears beyond doubt that the (claimant] can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957) (citations omitted) The pleading rules are quite liberal in that a claimant "need not set forth any theory or demand any particular relief for the court will award appropriate relief if the [claimant] is entitled to it upon any theory" New Amsterdam Cas. Co. v. Waller, 323 F.2d 20, 24-25 (4th Cir. 1963) (citations omitted). In considering a motion to dismiss, the court should accept as true all well-pleaded allegations and should view the claim in a light most favorable to the non-movant. See, e.g., De Sole v. United States, 947 F.2d 1169, 1171 (4th Cir. 1991) (citations omitted)
A. Defendant's First Counterclaim — Declaratory Judgment
Through its first counterclaim, Defendant seeks a declaratory judgment of noninfringement, invalidity, and unenforceability. Plaintiff argues that this counterclaim should be dismissed because Defendant alleges no facts that could support Defendant's claim for a declaration of noninfringement, invalidity, and unenforceability.
Plaintiff also argues that Defendant's counterclaim for declaratory judgment should be dismissed as a matter of law because it fails to ask specifically for any declaratory relief. However, this counterclaim is entitled "DECLARATORY JUDGMENT OF NON-INFRINGEMENT, INVALIDITY AND UNENFORCEABILITY." (Def.'s Answer Countercls. at 7.) Furthermore, in its prayer for relief, Defendant seeks this declaratory relief as well. Consequently, this argument fails.
1. Noninfringement Invalidity
With regard to noninfringement, Defendant. admits that it has based its designs upon competing designs and that it sells lines of furniture in competition with Plaintiff's Coronado Collection. However, Defendant denies that it has ever infringed, or is now infringing, upon Plaintiff's Coronado Patents. With regard to invalidity, Defendant has alleged that the Coronado Patents are invalid for failure to comply with the requirements of patentability under Title 35 of the United States Code.
Determination of noninfringement and invalidity often are complex factual issues that require weighing evidence presented by the parties at a later stage of litigation. To rule on these issues at this time would be premature. Accordingly, Plaintiff's motion will be denied with respect to Defendant's counterclaim for a declaration of noninfringement and invalidity.
2. Unenforceability
With regard to unenforceability, Defendant makes no allegation that the Coronado Patents are unenforceable. Rather, Defendant states only that it "is investigating whether the patents are invalid and unenforceable by reason of inequitable conduct practiced by the patentee, assignee and/or prosecuting patent attorneys." (Def.'s Answer Countercls. at ¶ 57.) Because Defendant has alleged no set of facts at all in support of this claim, dismissal is proper. Conley, 355 U.S. at 45-46. Accordingly, Plaintiff's motion to dismiss will be granted with respect to Defendant's counterclaim for a declaration of unenforceability.
B. Defendant's Second Counterclaim — patent Misuse
Through its second counterclaim, Defendant seeks to hold Plaintiff liable for patent misuse. Plaintiff argues that Defendant's counterclaim for patent misuse should be dismissed for failure to state a claim because patent misuse is not in itself an affirmative claim but rather a defense against infringement.
In its response brief in opposition to Plaintiff's motion to dismiss, Defendant actually admits that patent misuse is not itself a claim. (Def.'s Br. in Opp'n to Pl.'s Mot. to Strike Def's Countercls. at 6-7.)
The Federal Circuit explains that patent misuse is not an affirmative claim, but rather a defense that "results in rendering the patent unenforceable until the misuse is purged." B Braun Med., Inc. v. Abbott Labs., 124 F.3d 1419, 1427 (Fed. Cir. 1997); see also Virginia Panel Corp. v. Mac Panel Co., 133 F.3d 860, 868 (Fed. Cir. 1997) ("Patent misuse is an affirmative defense to an accusation of patent infringement."). Defendant's characterization of patent misuse as a claim for relief fails because "the defense of patent misuse may not be converted to an affirmative claim for damages simply by restyling it as a declaratory judgment counterclaim." B. Braun Med., 124 F.3d at 1428. Accordingly dismissal of Defendant's counterclaim for patent misuse is warranted.
Because Defendant's answer brought into question the issue of parent misuse (albeit in an incorrect manner), the court, in its discretion, will treat the patent misuse issue as though Defendant asserted it as an affirmative defense.
CONCLUSION
For the foregoing reasons, Plaintiff's motion to dismiss Defendant's counterclaims will be granted in part and denied in part.An order in accordance with this memorandum opinion shall be entered contemporaneously herewith.