Apple Inc. v. Princeps Interface Technologies LLC

Background

The dispute concerns U.S. Patent No. 6,703,963, which relates to a portable version of a traditional two-handed QWERTY keyboard. Princeps I filed a patent-infringement action against Apple in the District of Delaware on June 14, 2019, and voluntarily dismissed it without prejudice on October 4, 2019. Apple then filed this action seeking a declaratory judgment of noninfringement. The patent was later reassigned to Princeps II, which filed counterclaims against Apple for direct infringement, willful infringement, and indirect infringement through inducement and contributory infringement.

Apple moved under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a pleading does not state a legally sufficient claim. The court applied the rule that pleadings must include enough factual allegations to make liability plausible, rather than merely reciting the elements of a claim.

Willful Infringement

The court explained that willful infringement can support enhanced patent damages in especially egregious cases. At the pleading stage, the claim required allegations supporting both Apple’s knowledge of the patent and egregious conduct.

The court found that Princeps II adequately alleged knowledge because the earlier Delaware complaint identified the same patent. But Princeps II did not plausibly allege egregious conduct. Its principal factual allegation was that Apple updated software after the Delaware action began, including removing the Emoji icon from a keyboard. The court stated that changing a product to design around a patent could support Apple’s position because the patent system encourages design-around efforts. The court therefore granted Apple’s motion to dismiss the willful-infringement counterclaim with leave to amend.

Induced Infringement

Induced infringement under 35 U.S.C. § 271(b) requires direct infringement and facts showing that the accused party knowingly induced infringement with specific intent to encourage it. Princeps II alleged that Apple induced partners and customers to infringe by providing instructional materials or services related to Apple’s accused devices.

The court found these allegations insufficiently specific. Princeps II did not identify particular instructional materials or services or explain what they contained. The court also noted that Apple’s declaratory-judgment action arguably reflected a reasonable, good-faith belief in noninfringement, which can negate the specific intent required for induced infringement. The court granted Apple’s motion to dismiss the induced-infringement counterclaim with leave to amend and stated that an amended pleading must plausibly allege facts showing Apple’s specific intent.

Contributory Infringement

Contributory infringement under 35 U.S.C. § 271(c) requires allegations that the accused party sold or offered to sell a component specially made or adapted for infringing use, knowing that it was intended for that use, and that the component was not a staple article or commodity capable of substantial non-infringing uses.

Princeps II alleged that Apple’s iPhones, iPads, and iPods, together with their software and operating systems, were material components specially made or adapted for infringement. The court found that the counterclaim merely paraphrased the statute and supplied no factual basis for the allegation that Apple knew its products were not staple articles capable of substantial non-infringing use. The court granted Apple’s motion to dismiss the contributory-infringement counterclaim with leave to amend.

Disposition

Judge Edward M. Chen granted Apple’s motion to dismiss Princeps II’s willful, induced, and contributory infringement counterclaims with leave to amend. Any amendment had to comply with Federal Rule of Civil Procedure 11 and be filed within 30 days of the order. The order disposed of Docket No. 39.