Alivecor, Inc. v. Apple, Inc.

Background

AliveCor filed an antitrust lawsuit against Apple in May 2021. AliveCor alleges that Apple monopolized the market for watchOS heart-rate-analysis applications through anticompetitive acts, including changes to watchOS that allegedly prevented competitors from offering similar applications to Apple Watch users.

AliveCor later sought leave to file what the order discusses as a supplemental pleading and, in the conclusion, calls a first amended complaint (FAC). The proposed pleading adds claims, factual allegations, and damages based on Apple’s alleged filing of five inter partes review (IPR) petitions with the federal Patent and Trademark Office. AliveCor alleges that Apple filed those petitions solely to force it to spend resources defending them and to drive it out of business. It further alleges that the petitions were motivated by anticompetitive intent, connected to Apple’s earlier alleged conduct involving watchOS, and caused additional antitrust damages in the form of litigation expenses.

Leave to Amend

The court analyzed the request under Federal Rule of Civil Procedure 15(d), which allows a court to permit additional allegations about events occurring after the original pleading. The court applied the same general factors used for amendment under Rule 15(a): undue delay, bad faith or improper motive, repeated failure to cure deficiencies, undue prejudice to the opposing party, and futility. Prejudice to the opposing party carries the greatest weight in that analysis.

The court found that the factors favored allowing the proposed pleading. It found no basis to conclude that AliveCor acted in bad faith or delayed unduly, noted that AliveCor had not previously amended its complaint, and found that the proposed allegations were sufficiently connected to the existing antitrust claims. Although the new allegations presented a new theory of antitrust damages and would broaden the case, the court concluded that Apple had not shown prejudice substantial enough to justify denying leave. Discovery was still ongoing, and the court was not persuaded that the additional discovery would require denying the motion.

The court also found that the proposed supplement was not futile. Futility means that the proposed amendment could not support a legally valid claim. The court stated that AliveCor had satisfied this limited inquiry but expressly made no decision about the merits of AliveCor’s new legal theory. The court declined AliveCor’s request to prevent Apple from later filing a motion to dismiss the new claims.

Discovery Stay

Apple asked the court to stay, or pause, discovery into AliveCor’s new claims until Apple’s anticipated motion to dismiss was resolved. The court denied Apple’s request because Apple had not shown that a discovery stay was warranted at that time.

Motions to Seal

AliveCor asked to file portions of its reply and supporting declarations under seal. Because the materials concerned a non-dispositive motion, the court required AliveCor to show good cause and specific harm that would result from public access.

The court denied AliveCor’s motions to seal. It found that AliveCor relied on general references to materials previously sealed in connection with a supplemental protective order, did not identify a specific privacy or public-interest justification for sealing the particular information, and did not explain what harm would result from disclosure. The court also noted that Apple had not filed a declaration supporting sealing. The court directed AliveCor to file public versions of the documents within seven days from the date of the order.

Disposition

The court granted AliveCor’s motion for leave to file its first amended complaint, denied AliveCor’s motions to seal, and denied Apple’s request to stay discovery. AliveCor was directed to file the FAC attached to its motion within seven days from the date of the order. The order did not resolve the ultimate merits of AliveCor’s antitrust claims or new legal theory.