Kawasaki Jukogyo Kabushiki Kaisha v. Rorze Corporation

Background

Kawasaki brought five patent-infringement claims against Rorze Corporation and Rorze Automation, Inc. involving five reissue patents titled “Wafer Transfer Apparatus and Substrate Transfer Apparatus.” The claims included direct, induced, contributory, and willful infringement theories. In its June 15, 2023 order, the court found that Kawasaki had adequately pleaded direct and induced infringement involving the defendants’ “stocker” products, but dismissed the contributory- and willful-infringement claims under Federal Rule of Civil Procedure 12(b)(6), which concerns whether a complaint states a legally sufficient claim. The court allowed amendment.

Kawasaki sought partial reconsideration of the dismissal of its willful-infringement claims. Kawasaki relied on the Federal Circuit’s decision in SRI International, Inc. v. Cisco Systems, Inc., which explained that willful infringement requires deliberate or intentional infringement, while egregious conduct is required for enhanced damages. The parties and the court agreed that the earlier requirement of alleged egregious conduct warranted reconsideration.

Court’s Analysis

At the motion-to-dismiss stage, the court accepted the complaint’s factual allegations as true and drew reasonable inferences for Kawasaki. The court concluded that the First Amended Complaint alleged facts supporting an inference that the defendants acted deliberately or intentionally. Kawasaki alleged that it sent letters notifying the defendants about the patents and possible infringement. It also alleged that the defendants responded with substantive arguments explaining why their products did not infringe. According to the court, those responses supported inferences that the defendants understood the infringement allegations, seriously reviewed the patents and their own technology, and appreciated a risk of infringement.

The court emphasized that the defendants’ responses did not conclusively establish specific intent to infringe. They were nevertheless enough at the pleading stage to support an inference of willfulness. The court also stated that its conclusion did not depend on whether the defendants’ non-infringement arguments were legally correct. Instead, it relied on the alleged fact that the defendants substantively reviewed the patents, evaluated their own technology, and reached conclusions about infringement.

Application to the Patents and Disposition

The court held that Kawasaki sufficiently alleged willfulness for RE772, RE465, and RE145. For RE772, the relevant alleged conduct was conduct after August 2017. For RE465 and RE145, the relevant alleged conduct was conduct after July 2019. As to those claims and periods, the court denied the defendants’ motion to dismiss.

The court held that Kawasaki had not sufficiently alleged willfulness for RE909 and RE031. Notice that patent applications were pending was not enough to infer willfulness after the patents issued. Although Kawasaki alleged that it later notified the defendants that RE909 and RE031 had been approved and registered, it did not allege that the defendants responded to that later notice in the same way they had responded to earlier notices. The court granted the defendants’ motion to dismiss as to those patents and dismissed the corresponding willful-infringement claims with leave to amend.

The court granted Kawasaki’s motion for partial reconsideration, vacated Section III(D) and its corresponding holdings in the June 15, 2023 order, and amended that order as described above. Kawasaki’s amended complaint was due within twenty-one days after the order. The court denied without prejudice the administrative motions to designate additional claim terms and to schedule a claim-construction hearing, leaving those matters for further discussion at a later case-management conference.