United States District Court, S.D. New York
MEMORANDUM & ORDER
ALISON J. NATHAN, District Judge.
In this action, Plaintiff Conair Corporation alleges that Defendants Jarden Corporation and Sunbeam Products, Inc. d/b/a Jarden Consumer Solutions (collectively, "Jarden") have infringed its patent in a milk container attachment for a cappuccino maker ("the '972 patent"). Conair brings claims of direct infringement, inducing infringement, and contributory infringement under 35 U.S.C. § 271(a), (b), and (c), respectively. Before the Court is Jarden's motion to dismiss Conair's inducement and contributory infringement claims. Dkt. No. 13. For the following reasons, Jarden's motion is denied.
Conair is a developer, manufacturer, and marketer of consumer products and appliances; it owns the brand Cuisinart, through which it sells espresso, cappuccino, and latte makers. Am. Compl. ¶¶ 1, 14. In 1995, Conair became the owner of the '972 patent, which is entitled "Milk Container Attachment for Cappucino [sic] Maker." Id. ¶ 13. The patent's abstract reads:
A separate, removable milk container is provided which can be attached to and detached from a cappucino coffee maker. Alternatively, it can be attached to a modified espresso maker, converting it to making cappucino. The container has make and break connections for a milk delivery tube, so that, when the unit is not in use, the milk container can be removed from the unit and stored in a refrigerator to prevent spoiling of the milk. The cappucino maker includes a steam line to heat the coffee and milk. This line runs through a venturi, drawing milk into it, and then forces the steamed and frothed milk to a steamed milk outlet proximate to the coffee dispensing spout. The separate milk container includes means for attaching it to the unit and a milk tube which runs to the venturi. Thus, in use, the venturi draws milk from the container into the steam line and to the frothed milk outlet.
Am. Compl. Ex. A at 1. The patent contains five claims; four describe "improvements" to a cappuccino maker, and the fifth describes the detachable milk unit. Id. at 6.
According to Conair's amended complaint, Jarden also manufactures espresso, cappuccino, and latte machines through its brand Mr. Coffee. Am. Compl. ¶ 6. At least four machines sold under the Mr. Coffee imprint, which Conair calls the "Accused Products, " allegedly infringe the '972 patent. Id. ¶¶ 6-7. On April 25, 2013, Conair notified Jarden by letter that these models infringed the '972 patent, yet Jarden "did not stop manufacturing, importing, offering to sell, [or] selling" the infringing machines, nor did it recall them. Id. ¶ 16. On that basis, Conair claims that Jarden is liable for direct infringement, inducing infringement, and contributory infringement. See id. ¶¶ 21-25.
Conair commenced this action on September 23, 2013, and Jarden filed its motion to dismiss on January 15, 2014. Pursuant to Rule 3.F of the undersigned's individual rules of practice in civil cases, Conair was given an opportunity to amend its complaint in response to Jarden's motion. Conair indicated that, in response to information provided by Jarden, it would change the name of one of the Defendants from "Jarden Consumer Solutions" to "Sunbeam Products, Inc. d/b/a Jarden Consumer Solutions." Dkt. No. 17. However, Conair also indicated that it would not be amending the complaint's substantive allegations. Accordingly, Jarden's motion to dismiss remained pending after Conair filed its amended complaint on January 27, 2014, and that motion was fully submitted on February 24, 2014.
Jarden only moves to dismiss Conair's claims for inducing infringement and contributory infringement. With respect to direct infringement, a patent complaint that complies with Form 18 for patent claims-as Jarden concedes Conair's complaint does, see Def. Reply at 1-2-may not be dismissed on the ground that it fails to state a claim. See K-Tech Telecomms., Inc. v. Time Warner Cable, Inc., 714 F.3d 1277, 1283-84 (Fed. Cir. 2013). By contrast, claims of inducement and contributory infringement must be evaluated under the familiar Rule 12(b)(6) standards set forth in the Supreme Court's Twombly and Iqbal decisions. See In re Bill of Lading Transmission & Processing Sys. Patent Litig., 681 F.3d 1323, 1336 (Fed. Cir. 2012) ("Form 18 should be strictly construed as measuring only the sufficiency of allegations of direct infringement, and not indirect infringement."). Accordingly, with respect to Conair's claims of inducement and contributory infringement, the Court must determine whether Conair's complaint contains sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face, " setting aside any legal conclusions couched as factual allegations. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)) (internal quotation marks omitted).
A. Inducing Infringement
"Whoever actively induces infringement of a patent shall be liable as an infringer." 35 U.S.C. § 271(b). "Inducement requires a showing that the alleged inducer knew of the patent, knowingly induced the infringing acts, and possessed a specific intent to encourage another's infringement of the patent." Vita-Mix Corp. v. Basic Holding, Inc., 581 F.3d 1317, 1328 (Fed. Cir. 2009). Put differently, the defendant must intentionally induce activity that it actually knows to be infringing. See Global-Tech Appliances, Inc. v. SEB S.A., 131 S.Ct. 2060, 2068 (2011). Although Jarden is correct that many of the complaint's allegations amount to conclusory assertions, e.g., Am. Compl. ¶ 24 (alleging that Jarden infringed Conair's patent by "knowingly inducing the infringement... by end users of its Accused Products"), the Court nonetheless concludes that Conair has pled sufficient factual matter to state a claim of inducing infringement. Specifically, reading the complaint as a whole, the Court cannot agree with Jarden's argument that the mere sale of its espresso machines "cannot in any way be considered an act" that would induce infringement. Def. Reply at 3.
First, the complaint can reasonably be read to allege that Jarden's customers engaged in infringing activity. Conair alleges that Jarden "markets, distributes, and sells" its products, including Mr. Coffee espresso machines. Am. Compl. ¶ 3. The patent statute states that "whoever without authority makes, uses, offers to sell, or sells any patented invention" is liable for direct infringement. 35 U.S.C. § 271(a) (emphasis added). Thus, a customer's use of an infringing product constitutes primary infringement. See Aro Mfg. Co. v. Convertible Top Replacement Co., 377 U.S. 476, 484 (1964); R. Carl Moy, Moy's Walker on Patents § 14:32 (4th ed.) ("[O]ne who buys an infringing device from another, and who therefore has neither made the invention nor sold it, can be held liable for infringement when the device is used."). As a result, although Conair's complaint does not identify specific instances of direct infringement, it adequately alleges infringing activity by Jarden's "end users." Am. Compl. ¶ 24; see Bill of Lading, 681 F.3d at 1336 ("To state a claim for indirect infringement, ... a plaintiff need not identify a specific direct infringer if it pleads facts sufficient to allow an inference that at least one direct infringer exists.").
Second, drawing all reasonable inferences in Conair's favor, the complaint adequately alleges that Jarden intended for this infringing activity to occur. This case appears to be somewhat unusual, in that plaintiffs ordinarily sue for inducement when the defendant itself has not engaged in direct infringement-such as selling infringing products, as Conair alleges Jarden has done. Often, for example, a plaintiff will allege inducement when the defendant sells products that can be used to infringe, but which also have non-infringing uses. In such cases, intent can be inferred from circumstantial evidence that the defendant intended for its customers to use its product in an infringing way, but courts require something more than the mere sale of a product. See, e.g., DSU Med. Corp. v. JMS Co., 471 F.3d 1293, 1305 (Fed. Cir. 2006) (en banc) ("Evidence of active steps... taken to encourage direct infringement, ' such as advertising an infringing use or instructing how to engage in an infringing use, show an affirmative intent that the product be used to infringe, and a showing ...