Court: District Court, N.D. New York; August 27, 2015; Federal District Court
Enthone Inc. initiated a legal action against BASF Corporation for direct and indirect patent infringement under 35 U.S.C. § 271. BASF filed a motion to dismiss the indirect infringement claims, which Enthone opposed. The court ruled partially in favor of BASF’s motion. Enthone manufactures chemicals, including those used in microelectronics, and holds U.S. Patent Nos. 7,303,992 and 7,815,786, related to electrolytic copper deposition processes. These patents cover methods and compositions involving suppressor agents with polyether groups bonded to nitrogen species that enhance fill speeds in plating processes. Enthone claims BASF competes in this market and has produced copper plating solutions that infringe on its patents, specifically alleging that BASF's products contain the patented suppressor agents. Enthone further asserts that BASF distributes these products in the U.S., including New York, and induces infringement through its sales activities. The court acknowledged that Enthone's allegations might be substantiated with further discovery.
On June 30, 2014, Enthone notified BASF of potential infringement regarding patents '992 and '786, requesting verification or disproof of this belief and offering confidentiality protections for any shared information. BASF's attorney responded on August 14, 2014, seeking further information before addressing Enthone's claims. Enthone clarified on August 20, 2014, that it believed BASF's CUPUR® product line, specifically its copper electroplating suppressor containing a polyether compound with propylene oxide and ethylene oxide, infringed the patents. Following a series of communications, including a September 12 request for more time from BASF's attorney and a follow-up from Enthone on September 29, 2014, BASF's counsel indicated a response would come by October 3, 2014. However, by January 21, 2015, Enthone had yet to receive a response and requested one by January 28, 2015. BASF denied infringement on that date, leading to Enthone's reply on January 30, 2015, after which BASF ceased further communication.
Enthone's '992 patent describes a method for electroplating copper on semiconductor devices with submicron features, while the '786 patent outlines an electrolytic plating composition for similar applications. Enthone's Complaint alleges both direct and indirect infringement of these patents by BASF, with the case initiated on February 27, 2015. BASF filed a partial motion to dismiss on May 4, 2015, to which Enthone responded on May 21, and BASF replied on May 28. Under Rule 8(a), a complaint must present a clear claim for relief, with the court accepting factual allegations as true while drawing reasonable inferences in favor of the plaintiff, though legal conclusions are not afforded this presumption.
A complaint must present sufficient factual matter to establish a plausible claim for relief to withstand a motion to dismiss, as outlined in Bell Atlantic Corp. v. Twombly. Vague assertions and mere legal conclusions are insufficient; the claim must allow the court to infer the defendant's liability through factual content. Indirect infringement under patent law includes two categories: induced and contributory infringement. Enthone alleges induced infringement against BASF, asserting that BASF knowingly induced infringement and had the specific intent to encourage such actions. BASF contends that Enthone's allegations lack the necessary specificity regarding intent and direct infringement.
To prove induced infringement under 35 U.S.C. § 271(b), Enthone must demonstrate that there was direct infringement, that BASF intentionally induced this infringement, and that BASF had the specific intent to cause the infringement. Specific intent can be inferred from circumstantial evidence. BASF argues that simply selling a lawful product, with knowledge that a third party might infringe, does not constitute infringement by itself. However, Enthone claims that BASF's actions went beyond mere sales, as BASF allegedly facilitated and supported customers’ infringing activities, providing instructions that led to infringement. BASF also references a case to argue that Enthone's claims about the specificity of instructions lack sufficient detail to demonstrate intent.
The key issue revolves around whether BASF's instructions indicate an intent to infringe Enthone's patents. BASF argues that Enthone's failure to specifically identify these instructions undermines the claim. However, Enthone alleges that BASF was aware of the patent infringements, facilitated them, and provided instructions that contributed to the infringing use of its products. These assertions, taken together, support a reasonable inference of BASF's specific intent to induce infringement.
BASF references a previous case, Novartis Pharms. Corp. v. Wockhardt USA LLC, where a claim was dismissed due to a lack of explicit direction or evidence showing intent. However, in contrast, Enthone claims that BASF not only provided relevant instructions but also had knowledge of the patents, as evidenced by correspondence and BASF's own patent applications. Additionally, Enthone argues that BASF knowingly manufactured and supplied infringing products, creating conditions for customer infringement.
Overall, Enthone's allegations, while some may be deemed conclusory, collectively present sufficient factual support for the claim of induced infringement to withstand BASF's motion to dismiss.
BASF seeks to dismiss Enthone’s contributory infringement claim, arguing that the complaint lacks sufficient allegations, particularly regarding whether BASF’s infringing component has substantial non-infringing uses. Under 35 U.S.C. 271(c), for contributory infringement to be established, Enthone must demonstrate: (1) direct infringement, (2) BASF's knowledge of the patent, (3) the infringing component's lack of substantial non-infringing uses, and (4) that the component is a material part of the invention. BASF only challenges the third and fourth elements, not addressing the first two.
Regarding the absence of substantial non-infringing uses, BASF cites the precedent set in *In re Bill of Lading*, which requires plaintiffs to plead facts suggesting that the components have no substantial non-infringing uses. However, that case was dismissed because the allegations indicated that the infringing component did have substantial non-infringing uses. BASF claims Enthone's allegations are too vague and similar to those in *3D Systems v. Formlabs*, which were deemed insufficient because they lacked factual support for the assertion that the product had no substantial non-infringing uses. In contrast, Enthone’s complaint provides specific allegations detailing how BASF’s products infringe the patents, arguing that this distinguishes their case from *3D Systems*.
In Conair Corp. v. Jarden Corp., the U.S. District Court for the Southern District of New York addressed the challenges of alleging indirect infringement, particularly the difficulty in demonstrating a negative assertion at the pleading stage. The court highlighted that many post-Iqbal cases do not require extensive factual support for claims that a defendant’s product lacks substantial non-infringing uses. The court found that the plaintiff's assertion that the defendant’s products were unsuitable for substantial non-infringing use, coupled with a lack of facts undermining this assertion, was adequate to survive a motion to dismiss under Rule 12(b)(6).
Enthone’s complaint was deemed sufficient as it did not present contradictory facts indicating substantial non-infringing uses for BASF’s Electrolytic Copper Plating Products and provided details on how BASF’s products infringe the relevant patents. The court acknowledged the challenges posed by the Iqbal and Twombly standards but concluded that Enthone's allegations, particularly regarding the lack of non-infringing uses, alongside detailed patent descriptions, met the necessary specificity for the complaint to proceed.
Regarding BASF's argument about the contributory infringement claim, the court noted that to establish this under 35 U.S.C. § 271(c), Enthone must show that BASF's product constitutes a material part of the claimed invention. BASF contended that Enthone’s allegations were merely formulaic and lacked factual support for the materiality of the infringing product. However, Enthone countered that its complaint included a thorough explanation of how BASF’s specific suppressor infringes the patents, and that without this suppressor, BASF’s products would not achieve the required performance in filling submicron interconnect features.
Enthone references specific paragraphs from the Complaint to assert claims against BASF regarding infringement of the '992 and '786 patents. Notably, paragraphs 41 and 54 state that BASF's Electrolytic Copper Plating Products are essential to these patented inventions. Paragraphs 42 and 55 claim that BASF has contributed to infringement by selling or inducing the use of these products, which are tailored for infringing processes. However, BASF contests that Enthone has not adequately alleged that a specific suppressor is necessary for achieving the superior fill speed required for 'superfilling,' labeling this assertion as mere attorney argument without support in the Complaint.
The Court agrees with BASF, noting that, while Enthone describes the operation of the suppressors, they do not claim that 'superfilling' cannot occur without them. Although Enthone asserts that certain suppressors provide superior fill speeds and polarization, there is no indication in the Complaint that these speeds are essential for 'superfilling.' Therefore, the absence of an allegation establishing that 'superfilling' relies on these suppressors leads to the conclusion that Enthone has not sufficiently pleaded its case against BASF.
As a result, the Court partially grants BASF's motion to dismiss, specifically dismissing Enthone's contributory infringement claims without prejudice, allowing for re-pleading within thirty days. The motion is denied in all other respects.
