Symantec Corporation v. Acronis, Inc

RESPONSE

N.D. Cal.January 20, 2012

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case No. 3:11-cv-05310 EMC PLAINTIFF'S OPPOSITION TO MOTION TO DISMISS Jennifer A. Kash (Bar No. 203679) jenniferkash@quinnemanuel.com Eric E. Wall (Bar No. 248692) ericwall@quinnemanuel.com QUINN EMANUEL URQUHART & SULLIVAN, LLP 50 California Street, 22nd Floor San Francisco, California 94111 Telephone: (415) 875-6600 Facsimile: (415) 875-6700 David A. Nelson* davenelson@quinnemanuel.com Amanda S. Williamson* amandawilliamson@quinnemanuel.com Robert R. Cleary, Jr.* robertcleary@quinnemanuel.com Aaron Perez-Daple* aaronperezdaple@quinnemanuel.com QUINN EMANUEL URQUHART & SULLIVAN, LLP 500 West Madison Street, Suite 2450 Chicago, IL 60661 Telephone: (312) 705-7400 Facsimile: (312) 705-7401 *Admitted pro hac vice Attorneys for Symantec Corporation. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION SYMANTEC CORPORATION, Plaintiff, vs. ACRONIS, INC., Defendant. Case No. 3:11-cv-05310 EMC PLAINTIFF’S MEMORANDUM IN OPPOSITION TO DEFENDANT’S MOTION TO DISMISS COMPLAINT FOR FAILURE TO STATE A CLAIM UNDER RULE 12(B)(6) OR, IN THE ALTERNATIVE, MOTION FOR A MORE DEFINITE STATEMENT Date: Friday, February 24, 2012 Time: 1:30 PM Judge: Hon. Edward M. Chen Courtroom 5, 17th Floor San Francisco Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page1 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -1- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss INTRODUCTION In its motion to dismiss, Defendant Acronis, Inc. (“Acronis”) does not contest that Plaintiff Symantec Corporation (“Symantec”) has adequately pled that Acronis directly infringes the asserted patents. Rather, Acronis seeks to dismiss Symantec’s claims for contributory infringement and inducement. Acronis’ motion is merely a delay tactic to thwart the timely resolution of Symantec’s infringement action. The purpose of a complaint is to give Acronis fair notice of Symantec’s claims and the grounds on which they rest. Symantec has done so here by identifying, with respect to its contributory infringement and inducement claims, the products that infringe the patents in suit and the entities that directly infringe the patents. As courts in this district have concluded, the Supreme Court’s decisions in Twombley and Iqbal do not require Symantec to allege each and every element of these vicarious infringement claims. However, Symantec’s complaint also alleges all required elements of these claims and, thus, satisfies this higher standard as well. ARGUMENT I. SYMANTEC NEED NOT PLEAD EVERY ELEMENT OF CONTRIBUTORY INFRINGEMENT OR INDUCEMENT The Federal Rules require that Symantec plead “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). In view of this low standard for pleading, the threshold for prevailing on a motion to dismiss is correspondingly high. United States v. City of Redwood City, 640 F.2d 963, 966 (9th Cir. 1981) (holding that a motion to dismiss should only be granted under extraordinary circumstances). In order to survive a motion to dismiss, Symantec need merely state a claim for relief that is “plausible on its face.” Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). The complaint must establish only that there is “more than a sheer possibility that a defendant has acted unlawfully.” Id. at 1249-50. In deciding a motion to dismiss, all allegations in the complaint are to be taken as true. Newmatic Sound Sys., Inc. v. Magnacoustics, Inc., 2010 WL 1691862, at *2-3 (N.D. Cal. April 23, 2010 (citing Sanders v. Kennedy, 794 F.2d 478, 481 (9th Cir. 1986)). Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page2 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -2- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss Symantec need not plead each individual element of contributory infringement or inducement to withstand a motion to dismiss these claims. Numerous courts, including courts in this district and circuit, have concluded that the Supreme Court’s decisions in Twombley and Iqbal do not require element-by-element pleadings of these causes of action. Sony Corp. v. LG Elect. U.S.A., Inc., 768 F. Supp. 2d 1058, 1063 (C.D. Cal. 2011) (court found that plaintiff is not required to plead each individual element of a claim for indirect infringement); Rambus, Inc. v. Nvidia Corp., 2008 WL 4911165, at *3-4 (N.D. Cal. 2008) (alleging that defendant “actively induced” and “has contributed to and continues to contribute to” infringement held sufficient at pleading stage); Tune Hunter, Inc. v. Samsung Telecomm. Am., LLC, 2010 WL 1409245, at *4 (E.D. Tex. Apr. 1, 2010) (allegations that manufacturers of music identification systems either alone or in conjunction with others used, supplied, and sold systems infringing on patent were sufficient to plead claims of direct or contributory infringement); Mesh Comm, LLC v. EKA Sys., Inc., 2010 WL 750337, *1-2 (M.D. Fla. Mar. 4, 2010) (plaintiff pled all required elements of direct and indirect infringement claims with simple assertion of patents, naming of defendants, allegation of infringement, and invocation of specific section of patent law). Although Acronis cites this Court’s opinion in Wistron Corp. v. Phillip M. Adams & Ass., LLC, 2011 WL 4079231 (N.D. Cal., Sept. 21, 2011) in support of the contention that a complaint must make allegations to support each element of contributory infringement, Acronis misreads the Court’s holding. In Wistron, this Court dismissed the patentee’s claims because they did not allow the Court to draw a reasonable inference as to liability. Id. at *2. The Wistron patent infringement counterclaims are almost completely devoid of any facts and lack any description of the patented technology or the activities that constituted infringement. The patentee failed to even identify which of the computer hardware components, including “computer chips, motherboards, computers and other products,” were alleged of infringement. Id. at *5. Thus, the patentee’s pleadings clearly lacked the factual basis for its allegations. Here, however, Symantec has pled its claims in sufficient detail to withstand a motion to dismiss and has identified the products that are the subject of its infringement claims. Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page3 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -3- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss II. SYMANTEC HAS SUFFICIENTLY PLED ITS CLAIMS OF CONTRIBUTORY INFRINGEMENT AND INDUCEMENT A. Symantec Has Properly Pled Contributory Infringement and Inducement in the Alternative Acronis alleges (Br. at 5, 7) that the Complaint only “suggests” contributory infringement as a “potential ground” because Symantec alleges that “Acronis has infringed and continues to infringe, contributed to and continues to contribute to acts of infringement, and/or has actively and knowingly induced and continues to actively and knowingly induce the infringement” of the patents in suit. (Compl., ¶¶ 29, 30, 36, 37, 43, 44, 50, 51, 57, 58.) Acronis cites no authority for this proposition, which has no support in the law. Symantec’s complaint properly alleges each of its direct infringement, contributory infringement, and inducement theories. (Id.) The formulation “and/or” indicates that, to the extent that any such allegation is inconsistent with another allegation, Symantec is pleading these theories in the alternative, as is permitted by Federal Rule of Civil Procedure 8(d)(2). See also Brocade Comm. Sys., Inc. v. A10 Networks, Inc., 2011 WL 1044899, at *6-7 (N.D. Cal. 2011) (allegation that “A10 (and/or third parties acting on A10's behalf)” sufficiently identifies that any manufacturer, importer or seller in supply chain for A10's AX Series products indirectly infringes the patents). Thus, Symantec’s “and/or” formulation of its infringement claims is not a basis for dismissal. B. Symantec Has Properly Pled That There Has Been Direct Infringement With respect to Symantec’s contributory infringement and inducement allegations, Acronis contends that Symantec has failed to sufficiently plead the direct infringement that predicates these indirect infringement allegations. (Br. at 5-6, 7.) Acronis simply ignores the facts that Symantec has pled. Symantec pled that Acronis’ customers, who purchase Acronis’ products, directly infringe the patents in suit. Symantec specifically identified these products as the “Backup and Recovery product line,” which includes “Backup & Recovery 11 Workstation, Backup & Recovery 11 Server for Windows, Backup & Recovery 11 Advanced Server SBS Edition, Backup & Recovery 11 Server for Linux, Backup & Recovery 11 Online, Backup & Recovery 11 Advanced Server, Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page4 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -4- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss Backup & Recovery 11 Virtual Edition, and Backup & Recovery 11 Advanced Workstation,” and the True Image product line. (Compl., ¶¶ 25, 29, 36, 43, 50, 57.) Thus, the current case is distinguishable from Wistron, in which this Court dismissed the patentee’s counterclaims because of the failure to identify the products that were the subject of its vicarious infringement claims. Wistron Corp. v. Phillip M. Adams & Ass., LLC, 2011 WL 4079231 at *6 (N.D. Cal., Sept. 21, 2011).1 From these facts, the Court can draw the reasonable inference that it is the direct infringement committed by Acronis’ customers that forms the basis for Symantec’s contributory infringement and inducement claims. Iqbal, 129 S.Ct. at 1940. C. Symantec Need Not Plead Knowledge or Intent and, at a Minimum, Has Sufficiently Pled Claims for Future Contributory Infringement and Inducement Acronis also contends that Symantec’s contributory infringement and inducement claims should be dismissed because Symantec did not specifically allege that Acronis acted with the required knowledge or intent. (Br. at 6.) Numerous decisions in this district and others contradict Acronis’ arguments. First, courts have held that a patentee need not specifically plead the requisite intent to withstand a motion to dismiss contributory infringement or inducement claims. See, e.g., Sony Corp. v. LG Elect. U.S.A., Inc., 768 F. Supp. 2d 1058, 1063 (C.D. Cal. 2011) (denying a motion to dismiss and holding that defendant need not plead that “defendants' contributory infringement was knowing and intentional”); Brocade, 2011 WL 1044899, at *7 (proof of knowledge not required at pleading stage because question regarding knowledge and intent to induce infringement cannot be resolved without development of the factual record). Second, with respect to inducement, a court in this district has held that “alleging that defendant ‘actively induced’ is tantamount to alleging that defendant knowingly induced infringement.” Rambus, 2008 WL 4911165 at *3. Symantec has made these allegations here. 1 Symantec’s complaint also identifies the customers as “private users, branch offices and . . . enterprise clients,” and larger corporations. (Compl., ¶ 22.) Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page5 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -5- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss (Compl., ¶¶ 29, 36, 43, 50, 57.) Symantec is entitled to discovery to develop the factual record concerning Acronis’ knowledge of the patents in suit based upon its pleading in this action. Third, Acronis continues to sell its products despite the fact that it has been served with Symantec’s complaint. The complaint provides Acronis with knowledge of the patents in suit and it may thus be inferred that Acronis’ continued sales of its products are made with the requisite knowledge and intent. Schindler Elevator Corp. v. Otis Elevator Co., 2010 WL 1032651, at * 10 (D.N.J. 2010, Mar. 16, 2010) (quoting Prasco, LLC v. Medicis Pharm. Corp., 537 F.3d 1329, 1340 (Fed. Cir. 2008) (denying motion to dismiss where patentee sought an injunction and allegedly infringing activity was continuing despite service of the complaint)). Therefore, at a minimum, Symantec has properly pled contributory infringement and inducement for post-filing activity. Finally, this Court’s prior decision in Wistron is distinguishable from the instant case. The products accused of infringement in that case were unidentified computer components and the complaint failed to allege any facts regarding the manufacturers’ knowledge of how those components were used. Wistron Corp. v. Phillip M. Adams & Ass., LLC, 2011 WL 4079231 at *5 (N.D. Cal., Sept. 21, 2011). Here, Symantec accuses software products of infringement, which Acronis has developed for use in disk-imaging backup and disaster recovery. (Compl., ¶¶ 21-22.) Further, “Acronis has been aiming its products at protecting data in messaging and database systems within corporate environments.” (Id. ¶ 23.) From these facts, the Court can reasonably infer that Acronis knew and intended that its products be used for the applications for which they were developed. B-50.com, LLC v. Infosync Services, LLC, 2011 WL 1043456, at *1 (N.D. Tex. 2011). D. Symantec Has Sufficiently Pled the Remaining Elements of Contributory Infringement and Inducement Acronis also contends that Symantec must specify the “allegedly infringing combinations which include Acronis products” and specifically allege that Acronis’ products are especially designed for use in the patented invention. (Br. at 6, 7.) This argument is premised on the incorrect assumption that Symantec must plead each element of contributory infringement and Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page6 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -6- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss inducement. As noted in Section II.A., above, numerous courts have concluded that a patentee does not have to allege every element of its contributory infringement and inducement causes of action. See, e.g., Sony, 768 F. Supp. 2d at 1063 (holding that plaintiff is not required to plead each individual element of a claim for indirect infringement). Acronis fails to cite any support for the contention that Symantec needs to identify specific infringing combinations. Section 271(c) simply requires that the alleged infringer offers to sell, sells, or imports “a component of a patented machine, manufacture, combination, or composition, or a material or apparatus for use in practicing a patented process.” 35 U.S.C. § 271(c). Thus, even crediting Acronis’ incorrect reading of the law that Symantec must plead each element of its contributory infringement claims, Symantec has satisfied this requirement by identifying the Acronis products that are the component or material that contributes to infringement. (Compl., ¶¶ 25, 29, 36, 43, 50, 57.) To the extent that Acronis contends that Symantec must explain how the Acronis products contribute to infringement of the patents in suit in combination with other components, this Court has already rejected that contention. Wistron Corp. v. Phillip M. Adams & Ass., LLC, 2011 WL 4079231 at *3 (N.D. Cal., Sept. 21, 2011). Further, Symantec has pled facts from which it may be reasonably inferred that Acronis’ products are especially designed for use in the patented inventions. Iqbal, 129 S.Ct. at 1940. Symantec has pled that Acronis sells products, including its Backup and Recovery product line, to customers for use in “disk-imaging backup and disaster recovery.” (Compl., ¶ 23.) As is apparent from the complaint’s description of the patents in suit, in designing software with this functionality, the software is especially designed for the patented invention. (Id. ¶¶ 15-20.) III. A MORE DEFINITE STATEMENT IS NOT REQUIRED For the reasons set forth above, Symantec has adequately pled both its contributory infringement and inducement claims, identifying the products that form the basis for these claims and the Acronis customers responsible for the direct infringement underlying these claims. Accordingly, Acronis is able to ascertain whether, by selling its products to these customers, it contributes to and induces infringement and there is no reason to order Symantec to provide a more definite statement. Sagan v. Apple Computer, Inc., 874 F. Supp. 1072, 1077 (C.D. Cal. Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page7 of 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -7- Case No. 3:11-cv-05310 EMC Plaintiff's Opposition to Motion to Dismiss 1994) (“Motions for a more definite statement are viewed with disfavor and are rarely granted because of the minimal pleading requirements of the Federal Rules. Parties are expected to use discovery, not the pleadings, to learn the specifics of the claims being asserted.”). CONCLUSION For the reasons above, Symantec respectfully requests that the Court deny the Acronis Motion to Dismiss and the Alternative Acronis Motion for More Definite Statement. DATED: January 20, 2012 Respectfully submitted, QUINN EMANUEL URQUHART & SULLIVAN By: _/s Eric E. Wall________ Eric E. Wall Attorneys for Plaintiff Symantec Corporation Case3:11-cv-05310-EMC Document31 Filed01/20/12 Page8 of 8