Vilox Technologies, LLC v. Salesforce, Inc.

Background

Vilox Technologies, LLC and Vilox LLC brought a patent-infringement action against Salesforce, Inc. Dr. Joseph Lewis De Bellis, identified as Vilox Technologies’ President and CEO, purportedly assigned all interests in the patents at issue to himself. He then filed a renewed motion under Federal Rule of Civil Procedure 24 to intervene, asked under Rule 25(c) to substitute himself as a plaintiff in place of the Vilox entities, and asked for Vilox’s counsel, Ramey LLP, to withdraw.

Intervention

The court explained that intervention as of right under Rule 24(a)(2) requires a timely motion, a significantly protectable interest related to the case, a risk that the case’s resolution would impair the applicant’s ability to protect that interest, and inadequate representation by the existing parties. The court assumed, without deciding, that the first two requirements were met. It ruled that the remaining requirements were not.

Because the Vilox entities started the case as the patent owners, and because De Bellis’s interests were aligned with Vilox Technologies, the court found that the case’s outcome would not practically prevent him from protecting his interests. The court also found that the Vilox entities adequately represented those interests. It noted that De Bellis had already influenced the litigation through multiple filings despite not being a party. Differences over litigation strategy, including alleged pressure from counsel to abandon the case, did not justify intervention.

Substitution

Rule 25(c) allows a court, in its discretion, to substitute or join a transferee when an interest in the litigation has been transferred. The court stated that substitution is not required merely because an interest has been transferred and that the original party may continue the case.

The court concluded that substituting De Bellis would not facilitate the litigation. De Bellis sought to proceed without a lawyer while finding new counsel, which the court found would prolong the action. The court also stated that Vilox Technologies could replace Ramey LLP without substitution. In the court’s view, using Rule 25(c) to avoid the requirement that the Vilox entities litigate through licensed counsel was improper.

Disposition and next steps

The court DENIED the renewed motion to intervene and substitute. It DENIED AS MOOT Vilox’s counsel’s request to withdraw. If Vilox wishes to proceed with different counsel, new counsel must appear within 30 days of the order. If new counsel appears, the court will STAY the case for 45 days from counsel’s appearance to allow preparation. Salesforce may resubmit its motion to dismiss within 90 days of the order; the Vilox entities must oppose that motion within 14 days of its resubmission, and Salesforce must reply within 7 days after the opposition.