Richards Layton & Finger
 

Chief Judge Stark Grants in Part Motion to Dismiss

June 14, 2018

In Interface Linx, LLC v. Haier America Co., No. 17-1098-LPS (D. Del. Apr. 26, 2018), and related cases, Chief Judge Stark, ruling from the bench, granted in part the defendants’ motion to dismiss the direct, indirect, and willful infringement claims of the plaintiff, Interface Linx, LLC. The asserted patent covered, inter alia, an HDMI plug and receptacle.

Several defendants alleged that the accused products included only receptacles, not plugs, making direct infringement impossible, but Interface responded that those defendants’ internal use of the products (such as for testing and quality assurance) sufficed to state a claim. Interface also argued that the sale of products containing HDMI receptacles as well as the separate sale of plugs constituted direct infringement. On indirect infringement, the defendants emphasized the absence of any allegation of knowledge of the patent before the filing of the complaint. The parties disputed the relevant unit of analysis for contributory infringement: the defendants argued that the accused products had substantial non-infringing uses (i.e., receptacles for plugs other than HDMI), whereas Interface argued that the Court should look only to the HDMI receptacle. Finally, the defendants challenged the allegation of willfulness for lacking detail of egregious conduct.

As to those defendants that did not sell plugs, Interface did not oppose dismissal of its claims of direct infringement other than for use or dismissal of its claims for indirect and willful infringement before the filing of the complaint, and the Court so ruled. According to Chief Judge Stark, the allegation of direct infringement for the separate sales of a plug and a product containing a receptacle stated a claim at this point, but noted that with the benefit of further proceedings the Court could be persuaded otherwise.

Looking only to the HDMI receptacle, the Court found that the allegations of contributory infringement stated a claim and the allegations of advertising sufficed for inducement of infringement. But Chief Judge Stark found that the mere allegation of knowledge and continuing infringement, in the circumstances of this case, did not cross the plausibility threshold for willful infringement.

Key Point: Although the Court granted in part the defendants’ motions to dismiss, the Court would not dismiss the claims with prejudice as the defendants had requested. The Court furthermore instructed the plaintiff to re-plead with greater specificity that which each defendant was accused of, as opposed to attributing conduct to groups of defendants.