Shunock v. Apple, Inc.

Background

Michael Shunock sued Apple, Inc., alleging infringement of seven design patents. The patents relate to designs that Shunock had developed and that he alleged were infringed by Apple’s Activity Rings design, which Apple used in products and other offerings. Apple answered the complaint, asserted six affirmative defenses, and brought fourteen counterclaims: seven seeking declarations that Shunock’s design patents were invalid and seven seeking declarations that Apple did not infringe them.

Shunock moved under Federal Rule of Civil Procedure 12 to strike Apple’s fourth affirmative defense, which alleged that the design patents were unenforceable because of inequitable conduct before the U.S. Patent and Trademark Office. He also moved to dismiss Apple’s invalidity counterclaims for inadequate factual allegations and to strike Apple’s noninfringement counterclaims as redundant copies of his infringement claims.

Inequitable-Conduct Defense

The court held that Apple had not plausibly pleaded the materiality element of inequitable conduct. Apple focused on Shunock’s December 27, 2021 submission to the patent office seeking priority for his design-patent applications. Apple alleged that Shunock failed to disclose that he intended to assert the patents against Apple and that the patents could be invalid if the requested priority was not granted.

The court reasoned that Apple had acknowledged that Shunock previously submitted the Apple designs to the patent office. Thus, the alleged omission did not plausibly show that the patent office lacked information that would have affected issuance of the patents. The court also found no identified requirement that a patent applicant disclose an intention to assert patent rights against a potential infringer. It rejected Apple’s alternative argument that the alleged conduct qualified as exceptionally serious misconduct excusing the usual materiality showing.

The court therefore granted Shunock’s motion to strike the inequitable-conduct defense. The court also granted Apple leave to amend that defense within 60 days. The opinion did not state that the defense was barred from being repleaded.

Invalidity Counterclaims

The court denied Shunock’s request to dismiss Apple’s seven invalidity counterclaims. Apple identified four specific prior-art references, including particular figures, and alleged that the design patents failed to satisfy provisions of the Patent Act, including Sections 101, 102, 103, 112, and 171. The court concluded that these allegations gave Shunock fair notice of the invalidity theories at the pleading stage.

The court noted that issued patents are presumed valid and that Apple would have to overcome that presumption later. But the court held that Apple had met the lower pleading requirement by identifying prior art allegedly invalidating the patents. The court did not decide whether the prior art actually invalidates any patent.

Noninfringement Counterclaims

The court also denied Shunock’s request to strike Apple’s seven noninfringement counterclaims as redundant. Although the counterclaims sought declarations corresponding to Shunock’s infringement claims, the court held that they could serve an independent purpose because there had been no merits decision on Shunock’s infringement claims. If Shunock’s claims were dismissed without a merits ruling, Apple could remain exposed to future infringement claims.

The court distinguished cases in which a merits judgment had already resolved the infringement dispute. It concluded that Apple’s declaratory counterclaims should remain in the case at this stage, even though the court might ultimately resolve them together with Shunock’s infringement claims.

Disposition

Judge Jennifer L. Rochon ruled that Shunock’s motion was granted in part and denied in part. The motion to strike Apple’s inequitable-conduct affirmative defense was granted, with leave to replead within 60 days. The motion to dismiss or strike Apple’s counterclaims was denied. The court did not decide whether Apple infringed the design patents or whether the patents were valid.