Nikola Corporation v. Tesla Incorporated
- James Donato
- 3:18-cv-07460
- U.S. District Court · Northern District of California
- 4
In Nikola v. Tesla, Judge Donato denied Tesla’s motion to dismiss Nikola’s design-patent claims because the complaint plausibly alleged substantial similarity.
Nikola Corporation’s design-patent claims against Tesla, Inc. were allowed to proceed past Tesla’s motion to dismiss.
What happened
Nikola Corporation v. Tesla, Inc. concerns Nikola’s claims that Tesla infringed design patents for features of Nikola’s One truck. Tesla asked the court to dismiss only those design-patent claims.
Nikola’s complaint included side-by-side comparisons of Tesla’s truck designs and Nikola’s patented designs. Nikola alleged that an ordinary observer would find the designs substantially similar and also alleged that a former trucking-company CEO said Tesla’s truck looked like Nikola’s design.
Judge James Donato denied Tesla’s motion to dismiss. He ruled that Nikola had alleged enough specific facts to make its design-infringement claims plausible, and that the alleged similarity was not so clearly absent that the claims could be dismissed at this stage.
The detailed version
- Nikola Corporation v. Tesla Incorporated · No. 3:18-cv-07460
- James Donato
- Sept. 9, 2020
Background
Nikola sued Tesla for alleged infringement of design and utility patents and for trade-dress infringement under the Lanham Act. The claims concerned Nikola’s Nikola One heavy-duty truck. Tesla moved to dismiss only the design-patent claims under Federal Rule of Civil Procedure 8 and Rule 12(b)(6). Tesla did not challenge the trade-dress claim or the claim involving Nikola’s utility patent.
Nikola’s third amended complaint alleged that Tesla’s proposed heavy-duty truck design was substantially similar to Nikola’s patented designs. The complaint included side-by-side illustrations comparing features such as the wrap windshield, fuselage, and mid-entry door. Nikola also alleged that a former trucking-company chief executive told Nikola that “the Tesla semi looked like the Nikola design.”
Court’s Analysis
Rule 8 requires a complaint to provide a short and plain statement showing that the plaintiff is entitled to relief. Under Rule 12(b)(6), a claim may be dismissed if the complaint does not allege enough facts to make relief plausible on its face.
The court applied the ordinary-observer test for design-patent infringement. Under that test, infringement depends on whether an ordinary purchaser would view the accused design and the patented design as substantially the same and be deceived into thinking one was the other. The court said that design infringement is primarily a question of fact.
The court concluded that Nikola had plausibly alleged design infringement. Nikola used the correct substantial-similarity standard, pleaded specific facts, and supplied visual comparisons and an allegation of confusion among likely ordinary observers. After inspecting the comparisons, the court could not conclude that the designs were sufficiently dissimilar to justify dismissal as a matter of law.
Ruling
The court denied Tesla’s motion to dismiss. The court did not decide whether Nikola would ultimately prove infringement at trial or in another dispositive proceeding. The order also set a case-management conference for October 29, 2020, and required a joint conference statement by October 22, 2020.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.