Takeaway: Pleading infringement of patent infringement has become easier.
On May 1, 2018 in Disc Disease Solutions, Inc. v. VGH Solutions, Inc., the United States Court of Appeals for the Federal Circuit addressed the proper standard for pleading a direct infringement claim in a patent case. The appeal arose from a grant of a motion under Rule 12(b)(6) for failure to state a claim.
One of the interesting facts in the case was that it was filed on November 30, 2015, one day before the December 1, 2015 amendments to the Federal Rules of Civil Procedure, which abrogated Rule 84 and Form 18. Rule 84 included forms for pleading certain types of claims, with the language in such forms being deemed acceptable to meet federal court pleading standards. Form 18 continued to suffice even after the Twombly/Iqbal cases from the Supreme Court seemingly tightened pleading standards in federal cases.
In the Disc Disease case, the district court applied the post-December 1, 2015 pleading standard (i.e., Twombly/Iqbal) and dismissed the complaint. The district court held that a complaint for direct patent infringement that attached the asserted patents, identified the accused products, showed photographs of the accused products, and stated that the accused products met “each and every element of at least one claim” of each of the patents “either literally or equivalently” was not adequately pled under the Twombly/Iqbal standard. The plaintiff moved for reconsideration asking the district court to allow it to file a first amended complaint because the abrogation of Rule 84 and Form 18 was an intervening change in the law. The district court denied this motion, as well as an additional attempt by plaintiff on other grounds to file a first amended complaint. An appeal to the Federal Circuit ensued.
The Federal Circuit did not address whether the Form 18 standard or Twombly/Iqbal applied, but held that the plaintiff’s complaint satisfied the Twombly/Iqbal standard. Slip Op. at 7 n.3. The Federal Circuit noted that it has never recognized a distinction between Form 18 and Twombly/Iqbal, and that it did not need to determine whether such a distinction exists. Id. Rather, the Federal Circuit determined that at least for a case that “involves a simple technology,” attaching the patents-in-suit, identifying the accused products by name and photograph, and alleging that the accused products met each and every element of at least one claim in each of the patents-in-suit is sufficient to satisfy the Twombly/Iqbal pleading standard. Slip Op. at 8. It stated:
Disc Disease’s allegations are sufficient under the plausibility standard of Iqbal/Twombly. This case involves a simple technology. The asserted patents, which were attached to the complaint, consist of only four independent claims. The complaint specifically identified the three accused products – by name and by attaching photos of the product packaging as exhibits – and alleged that the accused products meet “each and every element of at least one claim of the ‘113 [or ‘509] Patent, either literally or equivalently.” [citation to record omitted]. These disclosures and allegations are enough to provide VGH Solutions fair notice of infringement of the asserted patents. The district court, therefore, erred in dismissing Disc Disease’s complaint for failure to state a claim.
Slip Op. at 8.
For practitioners, this case reaffirms what has been a trend in the last several years from the Federal Circuit – that is, pleading direct infringement claims in a patent case is not particularly onerous. The Federal Circuit seems reluctant to decide whether there was a difference between Form 18 and Twombly/Iqbal. Many practitioners and courts, including the district judge reversed in this case, believe than Twombly/Iqbal provided a more stringent pleading standard that pre-Twombly as well as Form 18. The Federal Circuit seems to think otherwise, and since the Federal Circuit is the major (but not supreme or sole) arbiter of patent law in the United States, it behooves patent practitioners to understand the Federal Circuit’s take on the direct patent infringement pleading standard – i.e., if one attaches the patent-in-suit, identifies the accused product and shows a photograph of it, and alleges that direct infringement of at least one claim has occurred either literally or under the doctrine of equivalents, then the complaint will be found sufficient. As such, practitioners should think twice about filing a Rule 12(b)(6) motion in a relatively straightforward patent case where the patent is attached to the complaint, the accused products identified, and an allegation of infringement is made.