Craigslist, Inc. v. EveryMD.com LLC, 3-16-cv-03421 (CAND January 12, 2017, Order) (Chen, USDJ)
Tuesday, January 17, 2017
Hastily Filed Declaratory Judgment Claim Did Not Violate Rule 11 in Light of PTAB Institution Decision
The court denied a patentee-defendant's motion for Rule 11 sanctions because plaintiff's claims for declaratory relief of noninfringement and invalidity were not frivolous in light of the PTAB's decision to institute inter partes review of a related claim. "Although [defendant] criticizes [plaintiff] for not providing an attorney declaration testifying about what inquiry was conducted in the two days between the receipt of [defendant's] notice-of-infringement letter and the filing of [plaintiff's] complaint seeking declaratory relief, that failure is immaterial so long as [plaintiff's] complaint was not legally or factually baseless from an objective perspective. Here, [defendant] claims that . . . [plaintiff's] contention that claim 4 of the [patent-in-suit] was invalid was not factually supported. But that position cannot be sustained given the results of [a related] inter partes review. . . . [T]he PTAB's grant of review on claim 1 implicates the validity of claim 4, because claim 4 is, in effect, part of the process described in claim 1, only in reverse. [Defendant's] argument that 'dependent or multiple dependent claims [i.e., claim 4] shall be presumed valid even though dependent upon an invalid claim [claims 1-3],' does not establish [plaintiff's] challenge to claim 4 is frivolous."