Case 3:16-cv-02350-GPC-RBB Document 24 Filed 01/11/17 Page 1 of 15
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`UNITED STATES DISTRICT COURT
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`SOUTHERN DISTRICT OF CALIFORNIA
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`MYGO, LLC, a California corporation,
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`Plaintiff,
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`v.
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`MISSION BEACH INDUSTRIES, LLC,
`a California corporation,
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`Defendant.
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` Case No.: 3:16-cv-02350-GPC-RBB
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`ORDER GRANTING IN PART AND
`DENYING IN PART PLAINTIFF’s
`MOTION TO DISMISS AND
`MOTION TO STRIKE WITOHUT
`PREJUDICE
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`[ECF No. 10.]
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`Before the Court is Plaintiff and Counterdefendant MyGo, LLC’s (“Plaintiff’s” or
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`“MyGo’s”) motion to dismiss Defendant and Counterclaimant Mission Beach Industries,
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`LLC’s (“Defendant’s” or “MBI’s”) first through fifth counterclaims pursuant to Fed. R.
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`Civ. P. 12(b)(6) and motion to strike MBI’s second, third, fourth, fifth, and eighth
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`affirmative defenses pursuant to Fed. R. Civ. P. 12(f). (Dkt. No. 10 at 1–2.1) The motion
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`has been fully briefed. (Dkt. Nos. 19, 20.) The Court deems Plaintiff’s motion suitable
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`for disposition without oral argument pursuant to Civil Local Rule 7.1(d)(1). Having
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`reviewed the moving papers and the applicable law, and for the reasons set forth below,
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`the Court GRANTS IN PART and DENIES IN PART MyGo’s motion to dismiss and
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`1 All citations to the record are based upon pagination generated by the CM/ECF system.
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`Case 3:16-cv-02350-GPC-RBB Document 24 Filed 01/11/17 Page 2 of 15
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`GRANTS IN PART and DENIES IN PART MyGo’s motion to strike. (Dkt. No. 10.)
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`BACKGROUND
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`MyGo designs and sells the MyGo Mouth Mount, a camera mouth mount for
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`GoPro® cameras. (Dkt. No. 1, Compl. ¶ 8.) On March 4, 2015, MyGo filed United
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`States Patent Application No. 14/639,040. (Id. ¶ 9; Dkt. No. 1-3.) This patent
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`application claimed priority to United States Provisional Patent Application No.
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`61/948,308, which was filed on March 4, 2014. (Id.) On September 10, 2015, MyGo’s
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`patent application was published as United States Patent Application Publication No.
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`2015/025361 (“MyGo’s published patent application”). (Id.) On July 5, 2016, the
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`United States Patent and Trademark Office (“PTO”) issued United States Patent No.
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`9,383,630 (“‘630 Patent” or “patent-in-suit”), entitled “Camera Mouth Mount.” (Compl.
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`¶ 9; Dkt. No. 1-2.) MyGo owns all rights to the ‘630 Patent pursuant to an assignment
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`recorded at the PTO on May 19, 2015. (Compl. ¶ 9.)
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`MyGo alleges that “MBI is and has been making, using, selling, offering for sale,
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`and importing a number of camera mouth mount products that infringe the ‘630 Patent,
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`including without limitation MBI’s Dummy Mount (in various colors), Dummy Mount
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`Kit, Dummy Bundle Kit (in various colors), and Dummy V2 Mouth Mount.” (Id. ¶ 10.)
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`MBI sells these products via MBI’s website, third-party websites, and various retailers
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`within the United States and worldwide. (Id.) Shortly after filing its patent application,
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`MyGo informed MBI of its patent application, MyGo’s potential patent rights, and MBI’s
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`potential infringement liability on May 14, 2014. (Id. ¶ 11.)
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`On April 28, 2015, MBI filed United States Patent Application No. 14/698,700
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`(“MBI’s patent application”) for a patent entitled “Video Mouthpiece Apparatus and
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`Method of Making Same.” (Id. ¶ 12.) MBI’s patent application claims priority to United
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`States Provisional Patent Application No. 61/985,461, which was filed on April 29, 2014.
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`(Id.)
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`MyGo alleges that MyGo’s published patent application is prior art to the subject
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`matter of MBI’s patent application under 35 U.S.C. § 102(a)(2). (Id. ¶ 13.) On January
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`20, 2016, MyGo’s PTO representative submitted a Third-Party Submission Under 37
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`C.F.R. § 1.290 in MBI’s patent application to request that the PTO consider MyGo’s
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`published patent application as prior art. (Id.) The PTO subsequently issued an Office
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`Action on February 3, 2016 rejecting all pending claims of MBI’s patent application as
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`being anticipated by prior art references. (Id.) The PTO issued a Notice of
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`Abandonment on August 2, 2016 regarding MBI’s failure to reply to the Office Action.
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`(Id.)
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`Based on publicly accessible information on the PTO’s online Patent Application
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`Information Retrieval system, MyGo alleges on information and belief that MBI has no
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`patents pending. (Id. ¶ 14.) MyGo alleges that MBI nonetheless advertises on its website
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`that it has patents pending in connection with the allegedly infringing products. (Id. ¶ 15;
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`Dkt. No. 1-5.)
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`On September 16, 2016, MyGo filed a Complaint against MBI asserting five
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`claims for relief: (1) patent infringement under 35 U.S.C. §§ 154 and 271; (2) federal
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`false marking under 35 U.S.C. § 292; (3) false advertising under 28 U.S.C. § 1125(a); (4)
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`unfair competition under California common law; and (5) unfair competition under the
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`California Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code § 17200 et seq.
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`(Dkt. No. 1.)
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`On October 17, 2016, MBI filed an Answer with five counterclaims and eight
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`affirmative defenses. (Dkt. No. 7.) MBI asserts the following counterclaims: (1)
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`declaratory judgment of non-infringement; (2) declaratory judgment of invalidity of the
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`‘630 Patent; (3) invalidity based on fraud on the PTO and inequitable conduct; (4) unfair
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`competition under California common law; and (5) unfair competition under the UCL.
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`(Id.) MBI asserts the following affirmative defenses to MyGo’s Complaint: (1) failure to
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`state a claim under Fed. R. Civ. P. 12(b)(6); (2) non-infringement; (3) invalidity for
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`failure to comply with 35 U.S.C. §§ 101, 102, 103, and/or 112; (4) inequitable conduct
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`and fraud on the PTO; (5) unclean hands; (6) adequate remedy at law; (7) prosecution
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`history estoppel; and (8) patent misuse. (Id.)
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`MyGo filed the instant motion to dismiss and motion to strike on November 3,
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`2016. (Dkt. No. 10.)
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`A. Rule 12(b)(6)
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`LEGAL STANDARDS
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`A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the
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`sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). While a
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`plaintiff need not give “detailed factual allegations,” a plaintiff must plead sufficient facts
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`that, if true, “raise a right to relief above the speculative level.” Bell Atlantic Corp. v.
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`Twombly, 550 U.S. 544, 545 (2007). “To survive a motion to dismiss, a complaint must
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`contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is
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`plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly,
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`550 U.S. at 547). A claim is facially plausible when the factual allegations permit “the
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`court to draw the reasonable inference that the defendant is liable for the misconduct
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`alleged.” Id. In other words, “the non-conclusory ‘factual content,’ and reasonable
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`inferences from that content, must be plausibly suggestive of a claim entitling the
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`plaintiff to relief.” Moss v. U.S. Secret Service, 572 F.3d 962, 969 (9th Cir. 2009).
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`“Determining whether a complaint states a plausible claim for relief will . . . be a context-
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`specific task that requires the reviewing court to draw on its judicial experience and
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`common sense.” Iqbal, 556 U.S. at 679.
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`In reviewing a motion to dismiss under Rule 12(b)(6), the court must assume the
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`truth of all factual allegations and must construe all inferences from them in the light
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`most favorable to the nonmoving party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir.
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`2002); Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337–38 (9th Cir. 1996). Legal
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`conclusions, however, need not be taken as true merely because they are cast in the form
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`of factual allegations. Ileto v. Glock, Inc., 349 F.3d 1191, 1200 (9th Cir. 2003); W.
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`Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). When ruling on a motion to
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`dismiss, the court may consider the facts alleged in the complaint, documents attached to
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`the complaint, documents relied upon but not attached to the complaint when authenticity
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`is not contested, and matters of which the court takes judicial notice. Lee v. Los Angeles,
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`250 F.3d 668, 688–89 (9th Cir. 2001).
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`Where a motion to dismiss is granted, “leave to amend should be granted ‘unless
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`the court determines that the allegation of other facts consistent with the challenged
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`pleading could not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., Inc.,
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`957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture
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`Co., 806 F.2d 1393, 1401 (9th Cir. 1986)).
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`B. Rule 12(f)
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`Under Federal Rule of Civil Procedure 12(f), the Court may, by motion or on its
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`own initiative, strike “an insufficient defense or any redundant, immaterial, impertinent
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`or scandalous” matter from the pleadings. Fed. R. Civ. P. 12(f). The purpose of Rule
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`12(f) is “to avoid the expenditure of time and money that must arise from litigating
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`spurious issues by disposing of those issues prior to trial.” Whittlestone, Inc. v. Handi-
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`Craft Co., 618 F.3d 970, 973 (9th Cir. 2010) (quoting Fantasy, Inc. v. Fogerty, 984 F.2d
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`1524, 1527 (9th Cir. 1993), rev’d on other grounds by Fogerty v. Fantasy, Inc., 510 U.S.
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`517 (1994)).
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`The Court must view the pleading in the light more favorable to the pleader when
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`ruling on a motion to strike. In re 2TheMart.com, Inc. Sec. Litig., 114 F. Supp. 2d 955,
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`965 (C.D. Cal. 2000) (citing California v. United States, 512 F. Supp. 36, 39 (N.D. Cal.
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`1981)). Motions to strike are regarded with disfavor because striking is such a drastic
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`remedy. Freeman v. ABC Legal Servs., Inc., 877 F. Supp. 2d 919, 923 (N.D. Cal. 2012).
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`If a claim is stricken, leave to amend should be freely given when doing so would not
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`cause prejudice to the opposing party. Vogel v. Huntington Oaks Delaware Partners,
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`LLC, 291 F.R.D. 438, 440 (C.D. Cal. 2013) (citing Wyshak v. City Nat’l Bank, 607 F.2d
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`824, 826 (9th Cir. 1979)).
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`I. Motion to Dismiss Counterclaims
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`DISCUSSION
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`MyGo moves to dismiss MBI’s first through fifth counterclaims pursuant to Rule
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`12(b)(6). (Dkt. No. 10.)
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`A. MBI’s First Counterclaim
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`MBI agrees to dismiss its first counterclaim. (Dkt. No. 19 at 9.) Accordingly, the
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`Court DENIES AS MOOT MyGo’s motion to dismiss MBI’s first counterclaim.
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`B. MBI’s Second Counterclaim
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`MBI’s second counterclaim alleges that the ‘630 Patent is invalid for failure to
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`comply with the conditions and requirements for patentability under 35 U.S.C. §§ 101,
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`102(a)–(b), 103, and/or 112. (Dkt. No. 7 at 14–16.) MBI identifies two bases for
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`invalidity: prior art and obviousness. (Id.) MBI first alleges that MyGo’s patent is
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`invalid under 35 U.S.C. § 102(a)–(b) for failure to disclose relevant prior art references
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`during the examination period. (Id. at 15.) Specifically, MBI alleges that its “own
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`Dummy Mount product was used in daylight, on a public beach, in 2013 and disclosed to
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`the public and the surf community then and also at least as early as January 2014,” prior
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`to MyGo’s provisional filing date. (Id.) MBI next alleges that the ‘630 Patent is invalid
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`under 35 U.S.C. § 103, as the “public use and public disclosure” of MBI’s product
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`“would render obvious any so-called improvements of [MyGo’s] disclosure.” (Id.)
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`MyGo contends that MBI’s second counterclaim fails for a number of reasons.
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`First, MyGo argues that MBI fails to explain how the ‘630 Patent is invalid under 35
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`U.S.C. §§ 101 and 112. (Dkt. No. 10-1 at 5.)
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`Next, with respect to 35 U.S.C. § 102, MyGo contends that MBI’s allegations do
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`not spell out a plausible claim of invalidity. (Id. at 5–6.) Specifically, MyGo contends
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`that MBI’s allegation of public use is conclusory and lacks specific facts regarding the
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`degree of accessibility afforded to the public. (Id.) Moreover, MyGo states that MBI
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`never informed the PTO of its alleged pre-filing, public use of its Dummy Mount
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`product, violating its duty of candor to disclose all known information material to
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`patentability to the PTO. (Id. at 6.) MyGo concludes that MBI’s failure to disclose its
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`alleged public use is fatal to MBI’s own patent application and renders MBI’s allegations
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`of prior art “highly suspect, unbelievable, and entitled to no weight.” (Id.)
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`With respect to 35 U.S.C. § 103, MyGo contends that MBI has not pled sufficient
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`facts about the product that it allegedly used publicly. (Id.) For example, MBI does not
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`specify whether the Dummy Mount product “fully or only partially encompass[es] any
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`claim of the ‘630 patent,” and MBI “identifies no claim of the ‘630 patent that is
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`supposedly anticipated or rendered obvious by MBI’s purported public use of its Dummy
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`Mount.” (Id.) Nor does MBI identify which version of the Dummy Mount was publicly
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`used. (Id.)
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`MBI responds that its allegations of public use and disclosure are not conclusory,
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`but rather prove fatal to MyGo’s Patent. (Dkt. No. 19 at 9–11.) MBI argues that MyGo’s
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`contention that MBI violated its duty of candor is baseless. (Id.)
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`MBI’s second counterclaim, while skeletal, states a claim for invalidity at the
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`pleading stage. First, MBI alleges some facts that raise reasonable inferences plausibly
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`suggestive of a claim. MBI does not conclusorily allege an invalidating public use,
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`without more: it alleges that its Dummy Mount product was used “in daylight, on a public
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`beach” and made known to members of “the public and the surf community.” (Dkt. No.
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`7 at 15.) Second, the Court’s scheduling order (Dkt. No. 18) and Patent L.R. 3.3–3.4
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`require that invalidity contentions be served by February 1, 2017. “By requiring the party
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`claiming invalidity to flesh out and support its invalidity contentions early on, the Patent
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`Local Rules fulfill the function of Twombly and Iqbal.” Wistron Corp. v. Phillip M.
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`Adams & Assocs., LLC, No. C-10-4458 EMC, 2011 WL 1654466, at *11 (N.D. Cal. Apr.
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`28, 2011) (noting that “requiring a heightened pleading of invalidity would circumvent
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`this Court’s Patent Local Rules which require detailed disclosures as to invalidity
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`contentions soon after the suit is filed”); accord Elan Pharma Int’l Ltd. v. Lupin Ltd., No.
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`CIV. A. 09-1008 JAG, 2010 WL 1372316, at *5 (D.N.J. Mar. 31, 2010). Considering the
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`specific rules governing patent cases in this District, and construing MBI’s factual
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`allegations in the light most favorable to MBI, the Court concludes that MBI’s second
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`counterclaim survives the instant motion to dismiss.
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`Finally, although MBI does not explicitly allege that its public use occurred within
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`the one-year statutory bar under 35 U.S.C. § 102(b)(1), MBI does allege that the public
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`use occurred “in 2013,” and that public disclosure occurred “then and also at least as
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`early as January 2014.” (Dkt. No. 7 at 15.) MBI’s Provisional Patent Application was
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`filed on April 29, 2014. (Compl. ¶ 12; Dkt. No. 19 at 10.) Construing these allegations
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`in the light most favorable to MBI, MBI has sufficiently stated at the pleading stage that
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`its public use of the Dummy Mount product occurred within the one-year statutory bar.
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` Accordingly, the Court DENIES MyGo’s motion to dismiss MBI’s second
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`counterclaim.
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`C. MBI’s Third Counterclaim
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`MBI alleges in its third counterclaim that “[t]he ‘630 Patent is unenforceable and
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`void due to unclean hands, fraud, and inequitable conduct that occurred during the
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`application for and prosecution of the Patent.” (Dkt. No. 7 at 16.) As for fraud, MBI
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`alleges that MyGo intentionally “misrepresented its status as a micro-entity” to the PTO
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`in order “to obtain discounted fees to which it was not entitled” in violation of 37 C.F.R.
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`§ 1.29(j). (Id. at 16–17.) MBI alleges that MyGo does not qualify for micro entity status
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`under the gross income requirements enumerated in 37 C.F.R. § 1.29. (Id. at 19.) With
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`respect to inequitable conduct, MBI alleges that MyGo failed to disclose relevant prior art
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`references to the PTO in violation of 37 C.F.R. § 1.56. (Id. at 18–20.)
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`MyGo argues that MBI’s third counterclaim, which is based on MyGo’s alleged
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`fraud before the PTO, fails to meet the more stringent pleading standard of Fed. R. Civ.
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`P. 9(b). (Dkt. No. 10-1 at 8–9.) MyGo contends that MBI cannot plead allegations of
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`MyGo’s purported fraud on information and belief, absent a statement of facts upon
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`which the belief is founded and the reasons for the belief. (Id.; Dkt. No. 20 at 3–4.)
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`MyGo attaches two declarations from the ‘630 Patent’s inventors, Nicholas Brooks and
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`Jeffrey Russell, to counter MBI’s allegations and certify that MyGo satisfied the
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`requirements for micro entity status. (Dkt. No. 10-1 at 8–9; Dkt. Nos. 10-2, 10-3.)
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`In response, MBI argues that it has sufficiently pled the “who, what, when, where,
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`and how of the alleged fraud,” and that pleading on information and belief suffices where
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`MyGo’s and the inventors’ financial information lies uniquely within MyGo’s control.
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`(Dkt. No. 19 at 12.) Although it did not so plead in its counterclaim, MBI conjectures
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`that MyGo must not qualify for micro entity status due to its sponsorship of renowned
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`professional surfers, who likely are receiving large sums in compensation. (Id. at 14–15.)
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`As for inequitable conduct, MBI responds that (1) it pled that MyGo failed to disclose
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`various prior art references that would have precluded issuance of the patent; (2) it “is
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`able to provide the identities of the prior art in an amended counterclaim, if necessary,
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`but is going to have to disclose detailed invalidity contentions under local rules and the
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`Court’s scheduling order anyway”; and (3) it pled that MyGo “la[id] claim to inventions
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`that belonged to others (like MBI), fil[ed] a patent on the subject matter, then us[ed] the
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`patent to sue the actual inventor and tr[ied] to extract royalties on unpatented products.”
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`(Id. at 15.)
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`As an initial matter, MyGo does not request judicial notice of the Brooks and
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`Russell declarations. Nor has it provided any legal basis for the Court to do so. A court
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`cannot consider matters outside of the complaint on a Rule 12(b)(6) motion to dismiss,
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`unless those matters are: 1) authenticated documents that have been incorporated by the
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`complaint or 2) facts subject to judicial notice. Lee v. City of Los Angeles, 250 F.3d 668,
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`689–90 (9th Cir. 2001). The declarations are not authenticated documents that have been
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`incorporated by the complaint. See U.S. v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003).
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`Nor do they contain facts that are “not subject to reasonable dispute.” Fed. R. Evid.
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`201(b). In fact, MyGo submits the declarations to dispute MBI’s allegations. The Court
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`thus declines to take judicial notice of the content of the declarations. See In re Applied
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`Micro Circuits Corp. Sec. Litig., No. 01-CV-0649 K AJB, 2002 WL 34716875, at *3
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`(S.D. Cal. Oct. 4, 2002) (“If the Court were to consider this extrinsic evidence, it would
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`in fact convert this motion to dismiss into a motion for summary judgment, and the Court
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`is not willing to do so.”).
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`To comply with Fed. R. Civ. P. 9(b), allegations of fraud must be “specific enough
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`to give defendants notice of the particular misconduct which is alleged to constitute the
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`fraud charged so that they can defend against the charge and not just deny that they have
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`done anything wrong.” Bly-Magee v. California, 236 F.3d 1014, 1019 (9th Cir. 2001)
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`(quoting Neubronner v. Milken, 6 F.3d 666, 672 (9th Cir.1993)).
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`[T]o plead the ‘circumstances’ of inequitable conduct with the requisite
`‘particularity’ under Rule 9(b), the pleading must identify the specific who, what,
`when, where, and how of the material misrepresentation or omission committed
`before the PTO. Moreover, although “knowledge” and “intent” may be averred
`generally, a pleading of inequitable conduct under Rule 9(b) must include
`sufficient allegations of underlying facts from which a court may reasonably infer
`that a specific individual (1) knew of the withheld material information or of the
`falsity of the material misrepresentation, and (2) withheld or misrepresented this
`information with a specific intent to deceive the PTO.
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`Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312, 1328–29 (Fed. Cir. 2009).
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`While MBI does allege the basic “who, what, when where, and how” of MyGo’s
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`purported material misrepresentation and omission before the PTO, MBI includes no
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`allegations of underlying facts from which this Court may reasonably infer that specific
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`individuals affiliated with MyGo had the requisite knowledge and specific intent to
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`deceive the PTO. See id. MBI’s factual allegations suggest nothing about MyGo’s
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`knowledge and intent: MBI merely lists the actions that inventors Jeffrey Russell and
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`Nicholas Brooks and their attorneys took in certifying MyGo’s qualification for micro
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`entity status before the PTO. (Dkt. No. 7 at 16–20.)
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`Furthermore, while MBI is correct in arguing that “[p]leading on ‘information and
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`belief’ is permitted under Rule 9(b) when essential information lies uniquely within
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`another party’s control,” MBI fails to address the requirement that “the pleading set[]
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`forth the specific facts upon which the belief is reasonably based.” Exergen Corp., 575
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`F.3d at 1330–31 (concluding that an allegation of deceptive intent that “provide[d]
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`neither the ‘information’ on which it relies nor any plausible reasons for its ‘belief’”
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`failed to satisfy Rule 9(b)). MBI provides neither the information on which it relies nor
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`any plausible reasons for its belief. It simply asserts conclusorily that it believes that
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`MyGo intentionally deceived the PTO. (Dkt. No. 7 at 17, 19.)
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`Finally, MBI’s assertions regarding MyGo’s sponsorship of professional athletes
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`are extrinsic to its pleadings. (Compare Dkt. No. 19 at 14–15 with Dkt. No. 7 at 16–20.)
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`Should MBI wish to assert new factual allegations, it should do so in an amended
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`pleading.
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`Accordingly, the Court GRANTS MyGo’s motion to dismiss MBI’s third
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`counterclaim.
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`D. MBI’s Fourth and Fifth Counterclaims
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`MBI asserts common law and statutory unfair competition claims. (Dkt. No. 7 at
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`20–22.) Both claims are based on MBI’s allegations of MyGo’s “inequitable and
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`fraudulent conduct before the PTO.” (Id.) MyGo argues that MBI’s fourth and fifth
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`counterclaims fail for the same reasons that MBI’s third counterclaim fails, as the fourth
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`and fifth counterclaims are based on the same fraud allegations set forth in MBI’s third
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`counterclaim. (Dkt. No. 10-1 at 9.) Because MBI’s fourth and fifth counterclaims flow
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`from its third counterclaim, the Court GRANTS MyGo’s motion to dismiss MBI’s fourth
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`and fifth counterclaims.
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`II. Motion to Strike Affirmative Defenses
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`MBI moves to strike MBI’s second, third, fourth, fifth, and eighth affirmative
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`defenses under Rule 12(f). (Dkt. No. 10.)
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`In the Ninth Circuit, “[t]he key to determining the sufficiency of pleading an
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`affirmative defense is whether it gives plaintiff fair notice of the defense.” Simmons v.
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`Navajo County, Ariz., 609 F.3d 1011, 1023 (9th Cir. 2010) (quoting Wyshak v. City Nat’l
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`Bank, 607 F.2d 824, 827 (9th Cir. 1979)). “Fair notice generally requires that the
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`defendant state the nature and grounds for the affirmative defense.” Roe v. City of San
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`Diego, 289 F.R.D. 604, 608 (S.D. Cal. 2013). “It does not, however, require a detailed
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`statement of facts.” Id. “What constitutes fair notice . . . depends on the nature of the
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`defense being asserted. For well-established defenses, merely naming them may be
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`sufficient, but for others, a party may need to allege additional factual matter to provide
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`fair notice.” DC Labs Inc. v. Celebrity Signatures Int’l, Inc., No. 12-CV-01454 BEN
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`DHB, 2013 WL 4026366, at *4 (S.D. Cal. Aug. 6, 2013).
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`District courts within the Ninth Circuit are split on whether the pleading standard
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`subsequently articulated in Twombly and Iqbal extends to affirmative defenses. See J & J
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`Sports Productions, Inc. v. Scace, No. 10cv2496-WQH-CAB, 2011 WL 2132723, at *1
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`(S.D. Cal. May 27, 2011). Here, the parties disagree over which pleading standard
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`applies to affirmative defenses. MyGo argues that the Twombly and Iqbal pleading
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`standard applies, (Dkt. No. 10-1 at 9–10; Dkt. No. 20 at 5), while MBI responds that the
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`fair notice pleading standard applies, (Dkt. No. 19 at 8). Although the Ninth Circuit has
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`not yet explicitly addressed the issue, it has continued to articulate the fair notice
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`pleading standard in cases decided after Twombly and Iqbal. See, e.g., Simmons, 609
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`F.3d at 1023 (2010 decision); Kohler v. Flava Enterprises, Inc., 779 F.3d 1016, 1019 (9th
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`Cir. 2015) (stating that “the fair notice required by the pleading standards only requires
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`describing the defense in general terms” (internal citation and quotation marks omitted)).
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`In light of the Ninth Circuit’s recent decisions, this Court applies the fair notice pleading
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`standard to the instant motion to strike.
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`A. MBI’s Second Affirmative Defense
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`MBI asserts that it “has not infringed any valid and enforceable claim(s)” of the
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`‘630 Patent. (Dkt. No. 7 at 9.) MyGo contends that this defense is merely a legal
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`conclusion. (Dkt. No. 10-1 at 10.) However, given that the pleading standard for
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`affirmative defenses is “fair notice,” and that MyGo is well aware that infringement is at
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`the heart of this case, MBI’s second affirmative defense, while sparse in detail, provides
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`MyGo sufficient notice. Accordingly, the Court DENIES MyGo’s motion to strike
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`MBI’s second affirmative defense.
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`B. MBI’s Third Affirmative Defense
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`MBI asserts that “[t]he claims of the ‘630 Patent are invalid for failure to comply
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`with the conditions for patentability of, inter alia, 35 U.S.C. §§ 101, 102, 103, and/or
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`112.” (Dkt. No. 7 at 9.) This defense overlaps with MBI’s second counterclaim. (Id. at
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`14–16.) MyGo requests that this defense be stricken because it is a legal conclusion.
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`(Dkt. No. 10-1 at 10.) MBI responds that it provides sufficient notice of the statutory
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`provisions on which it relies to assert its defense. (Dkt. No. 19 at 17.) Here, MBI’s
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`defense, while skeletal, provides fair notice in the context of this patent infringement
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`action. See, e.g., Certusview Techs., LLC v. Usic, LLC, No. 2:14CV373, 2014 WL
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`12591937, at *15 (E.D. Va. Dec. 15, 2014) (denying motion to strike identical
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`affirmative defense, concluding defense was “contextually comprehensible”); Senju
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`Pharm. Co., Ltd. v. Apotex, Inc., 921 F. Supp. 2d 297, 300, 303–04 (D. Del.
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`2013) (denying motion to strike identical affirmative defense). Accordingly, the Court
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`DENIES MyGo’s motion to strike MBI’s third affirmative defense.
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`C. MBI’s Fourth Affirmative Defense
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`MBI asserts that MyGo’s claims are “barred by reason of inequitable conduct and
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`fraud” on the PTO. (Dkt. No. 7 at 10–11.) MBI’s allegations regarding this defense
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`overlap with its allegations in its third counterclaim. (Id. at 16–20.) MyGo contends that
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`this defense fails for the same reasons that MBI’s third counterclaim fails. (Dkt. No. 10-1
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`at 10.)
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`Here, MBI’s fourth affirmative defense sets forth allegations, made on information
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`and belief, that MyGo misrepresented its status as a micro entity to the PTO. (Dkt. No. 7
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`at 10–11.) It also sets forth allegations that MyGo failed to disclose “various, relevant
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`prior arts, patent and otherwise.” (Id.) MBI’s allegations regarding MyGo’s micro entity
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`status, while unable to pass muster under Rules 12(b)(6) and 9(b), nonetheless give
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`MyGo fair notice of the grounds for MBI’s defense. Accordingly, the Court DENIES
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`MyGo’s motion to strike MBI’s fourth affirmative defense.
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`D. MBI’s Fifth Affirmative Defense
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`MBI asserts that MyGo’s claims are barred by unclean hands. (Dkt. No. 7 at 11.)
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`MBI incorporates by reference its allegations from its fourth affirmative defense. (Id.)
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`Because MBI’s allegations in its fourth affirmative defense provide fair notice, the Court
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`DENIES MyGo’s motion to strike MBI’s fifth affirmative defense.
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`Case 3:16-cv-02350-GPC-RBB Document 24 Filed 01/11/17 Page 14 of 15
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`E. MBI’s Eighth Affirmative Defense
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`MBI alleges on information and belief that the ‘630 Patent is invalid and
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`unenforceable due to patent misuse by MyGo. (Dkt. No. 7 at 12–13.) MBI incorporates
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`by reference its counterclaim allegations and additionally asserts that MyGo has
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`“attempted to enforce its claims with respect to products not covered by the claims.”
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`(Id.)
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`Patent misuse is typically not pleaded in a complaint. Beco Dairy Automation, Inc.
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`v. Glob. Tech Sys., Inc., No. 112CV01310LJOSMS, 2015 WL 9583012, at *2 (E.D. Cal.
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`Dec. 31, 2015). As such, “a party asserting patent misuse as an affirmative defense must
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`provide ‘fair notice’ that a patent-holder has impermissibly broadened the scope of the
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`patent in a manner which has caused an anticompetitive effect.” Id. (granting motion to
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`strike affirmative defense of patent misuse which stated that the patentee “cannot enforce
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`its alleged patents against BECO due to its prior improper attempts to exploit the patents
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`beyond their lawful scope”). While MBI’s opposition brief explains in further detail the
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`bases for MBI’s assertion that MyGo is impermissibly broadening the scope of the ‘630
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`Patent, (Dkt. No. 19 at 19), MBI’s pleading