IP Law Daily, PATENT—N.D. Cal.: Largely favorable results for Kawasaki in patent case against Rorze Corporation, (Jun 17, 2024)

By Saurabh Kashyap, B.A., LL.B., LL.M.

Insufficient factual allegations led to dismissal of Rorze’s counterclaims, but fair notice preserved its affirmative defenses.

Ruling on multiple motions filed by the plaintiff/counter-defendant Kawasaki Jukogyo Kabushiki Kaisha (Kawasaki Heavy Industries) in a patent infringement lawsuit, a federal district court in California granted the motion to dismiss the defendant/counter-plaintiff Rorze Corporation’s counterclaims due to insufficient factual allegations. However, the court denied Kawasaki’s motion to strike out Rorze’s affirmative defenses, ruling that Kawasaki had fair notice of the defenses (Kawasaki Jukogyo Kabushiki Kaisha v. Rorze Corporation, No. 22-cv-04947-PCP (N.D. Cal. June 14, 2024)).

Background. The plaintiff/counter-defendant, Kawasaki Heavy Industries, is a leading engineering and manufacturing company from Japan known for its wide array of products, including motorcycles, heavy equipment, and aerospace technology. The defendant/counter plaintiff, Rorze Corporation, specializes in automation equipment for semiconductor and flat panel display manufacturing industries.

The asserted patents included several reissue patents held by Kawasaki, specifically U.S. Reissue Patent Nos. RE45,772; RE46,465; RE47,145; RE47,909; and RE48,031. These patents were initially filed between 2013 and 2018 and issued between 2015 and 2020, and they concern robots that handle silicon wafers within enclosed semiconductor processing stations. These patents aim to reduce contamination during manufacturing by utilizing robot arms with a single pivot axis to minimize dust generation.

Kawasaki filed this infringement lawsuit against Rorze in August 2022, asserting that Rorze's products infringed its patents. Kawasaki amended its complaint in September 2023. In response, Rorze filed its answer and counterclaims in October 2023, which it later amended. Rorze's counterclaims included allegations of inequitable conduct, antitrust violations, unfair competition, prosecution laches, noninfringement, and invalidity of Kawasaki's patents. Kawasaki has now moved to dismiss these counterclaims and to strike portions of Rorze’s affirmative defenses.

Requests for judicial notice. Kawasaki requested judicial notice of several documents in public Patent and Trademark Office files. This request, which Rorze did not oppose, was granted. The court took notice of the existence and contents of these documents but drew no further inferences or characterizations.

Inequitable conduct. Rorze's counterclaim for inequitable conduct alleged that Kawasaki misrepresented the novelty of the "robot invasion restricted region" and failed to disclose material prior art, including the SEMI E63 standard. The court found that Rorze did not sufficiently plead specific misrepresentations or omissions by Kawasaki with the particularity required under Rule 9(b). The court noted that advocating an interpretation of claims and teachings of prior art is permissible and that the patent examiner had considered the relevant prior art. The court referenced Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312, 1327 (Fed. Cir. 2009), which requires detailed allegations of who, what, when, where, and how regarding the alleged fraud.

Antitrust and unfair competition. These claims were based on the allegation of inequitable conduct. Since the inequitable conduct counterclaim was dismissed, the derivative antitrust and unfair competition claims were also dismissed.

Prosecution laches. Rorze alleged that Kawasaki's reissue applications exhibited a pattern of unreasonable delay aimed at broadening the scope of the patents to cover Rorze's activities. The court dismissed this counterclaim, stating that Rorze did not provide plausible facts showing an egregious misuse of the patent system. The court emphasized that a laches defense focuses on delay, which Rorze failed to demonstrate adequately.

Invalidity. Rorze sought a declaratory judgment on the invalidity of Kawasaki's patents based on false inventorship and improper reissue. The court dismissed the invalidity claim tied to false inventorship for the same reasons as the inequitable conduct claim. Regarding improper reissue, the court dismissed the claim, referencing its recent claim construction order, which resolved the term "robot invasion restricted region" and other shared terms consistently across all asserted reissue patents. The court cited Cumberland Pharm. Inc. v. Mylan Institutional LLC, 846 F.3d 1213, 1218 (Fed. Cir. 2017), to emphasize clear identification of a complete prior conception communicated to the named inventor for claims of false inventorship.

Motion to strike: Kawasaki's motion to strike Rorze’s affirmative defenses was denied. The court concluded that while Rorze’s allegations were insufficient to state plausible claims under the standards outlined in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) it had not pled itself out of raising these defenses later. Thus, the court allowed these defenses to potentially be argued later with a fuller factual record.

The Case is No. 22-cv-04947-PCP.

Judge: Pitts, P.

Attorneys: James R. Sobieraj (Crowell & Moring LLP) for Kawasaki Jukogyo Kabushiki Kaisha. John P. Passarelli (Kutak Rock LLP) for Rorze Corp.

Companies: Rorze Corp.

Cases: Patent CaliforniaNews