UCP International Co., Ltd. et al v. Balsam Brands Inc. et al, 3-16-cv-07255 (CAND May 9, 2017, Order) (Orrick, USDJ)
Thursday, May 11, 2017
Patentee's Infringement Claim Against Customers Creates Substantial Controversy With Manufacturer
The court denied defendant's motion to dismiss plaintiffs' declaratory relief action and rejected defendant's argument that its lawsuit against plaintiffs' customer was insufficient to create an actual controversy with plaintiffs. "[Defendant's] litigation against [plaintiffs' customer] was an affirmative act by [defendant] to enforce its patent rights against alleged infringement by [plaintiffs'] Tree. . . . Its claim charts referred only to [plaintiffs'] trees and explained how [defendant] believed [plaintiffs'] trees met each and every claim of [defendant's] patents. . . . [Defendant] argues that a lawsuit against a manufacturer’s customer is not sufficient for Article III standing. . . . As [defendant] admits, its claims against [the customer] were based solely on its selling [plaintiffs'] Trees, something [a plaintiff] itself did. Unlike [other cases cited by defendant], [defendant's] infringement claims against [the customer], based on its sales of [plaintiffs'] trees, necessarily demonstrate a case or controversy with [plaintiffs]."