CelLink Corp. v. Manaflex LLC

Background

CelLink sued Manaflex alleging infringement of U.S. Patent No. 11,116,070 and misappropriation of trade secrets under the federal Defend Trade Secrets Act. CelLink alleged that Robert C. Lane and Augusto E. Barton received its trade secrets while they were Tesla employees and later used those secrets at Manaflex. Lane founded Manaflex, and Barton later joined it as a director of engineering.

CelLink moved for leave under Federal Rule of Civil Procedure 15(a)(2) to file a first amended complaint. The proposed amendment would add Lane and Barton as individual defendants to the trade-secret claim, add two patent-infringement claims involving U.S. Patent Nos. 12,035,459 and 12,040,511, and add three claims seeking correction of inventorship concerning patents assigned to Manaflex.

Legal standard

Rule 15(a)(2) provides that courts should freely allow amendments when justice requires. The court considered the factors identified in Foman v. Davis: bad faith or a dilatory motive, undue delay, undue prejudice, futility, and repeated failure to correct deficiencies. The court explained that prejudice to the opposing party receives the greatest weight and that, absent prejudice or a strong showing of another factor, Rule 15 creates a presumption favoring amendment.

Court’s analysis

The court found that the defendants had not shown undue prejudice. The two patents supporting the new infringement claims issued in July 2024, so CelLink could not have asserted infringement of them before then. The court also found that Manaflex had known CelLink intended to add patent claims and could not reasonably claim surprise about continued litigation involving the original patent.

The court concluded that the early stage of the case reduced the significance of any additional discovery or claim-construction work. The parties had not served contentions, no case schedule had been entered, only minimal fact discovery had occurred, and they were still negotiating electronic discovery. The court also found that adding Lane and Barton would not change the scope or substance of the existing trade-secret claim.

The court rejected the defendants’ arguments that CelLink acted in bad faith or unduly delayed seeking amendment. It also declined to decide the merits of the proposed amended complaint at that stage. The court stated that challenges to the sufficiency of the amended claims could be raised through a later motion to dismiss or motion for summary judgment.

Disposition

The court GRANTED CelLink’s motion for leave to amend, Dkt. No. 95. It ordered CelLink to file its first amended complaint within three days from the date of the order. The court also set a case management conference for December 10, 2024, and directed the parties to file a joint case management statement by December 3, 2024.