Potter Voice v. Apple: Claims for Willfulness Survive Motion to Dismiss Where Siri Inventors Allegedly Knew of Patent Prior to Employment with Apple

by Jeffer Mangels Butler & Mitchell LLP
Contact

Potter Voice filed a patent infringement action against Apple, alleging infringement of U.S. Patent No. 5,729,659 (the '659 patent) through Apple products containing Siri. In 2010, Apple acquired a corporation called Siri, Inc., which in 2007 "spun off" from SRI International, the company that invented the Siri product now used on Apple's iPhone 4S and other Apple products.

As part of its patent infringement action, Potter Voice alleged that Apple willfully infringed the '659 patent. In a motion to dismiss, Apple disputed whether the allegations in the complaint adequately pled Apple's knowledge of the '659 patent.

In analyzing the motion to dismiss, the district court noted that "[w]hile courts have emphasized the importance of pleading the defendant's knowledge of the patent-in-suit, when, as here, the defendant is a corporation, this pleading requirement should be evaluated through the scope of corporate law and agency principles. It is well established that corporations act through their employees and an agent's knowledge will generally be imputed to the corporate principal so long as employees are acting within the scope of their employment."

As a result, the district court found that to require that the corporation is aware of the asserted patent is to say that certain of the corporation's employees have knowledge of willful infringement, it is safe to say that the employees required to have knowledge of the asserted patent must have some connection to the decision willfully to infringe.

Potter Voice's complaint alleged that "Apple learned of the '659 patent when it acquired Siri, Inc. employees who were the inventors of the SRI patents. The former Siri, Inc. employees were aware of the '659 patent because it was cited to them in the prosecution history of the SRI patents. These employees took their knowledge of the '659 patent to Apple when they became Apple employees in about 2007. Apple, having learned of the likelihood of infringement of the '659 patent, nevertheless acted in a way that infringed."

The district court concluded that this was "not a bare recitation of the legal elements of willful infringement, but constitutes facts describing how the alleged infringer came to learn of the patent in suit."

The district court also rejected Apple's assertion that the allegations fell short of the "plausibility" standard set by Iqbal and Twombly. "While willful infringement is not equal to fraud and therefore is not subject to the stringent Rule 9(b) particularity requirement, the Iqbal and Twombly standards still apply. See Mitutoyo Corp. v. Cent. Purchasing LLC, 499 F.3d 1284, 1290 (Fed. Cir. 2007). According to Apple, PVT's theory of Apple's knowledge is unlikely because the '659 patent was never cited by the examiners of the SRI patents, nor was it the subject of any office action or rejection. Apple admits that the inventors of the later patents submitted an Information Disclosure Statement (IDS) naming the '659 patent as knowledge of that patent. See id.

The district court found that these arguments went to the weight of the evidence and were not proper for a resolution on a motion to dismiss. "Apple's arguments, especially those that the Siri inventors would have forgotten the '659 patent, go to the weight of the evidence rather than the sufficiency of PVT's allegations. At the motion to dismiss stage, the Court does not undertake a full evaluation of "probability," but simply asks for "more than a sheer possibility that a defendant has acted unlawfully." See Iqbal, 556 U.S. at 678. With all of its allegations accepted as true, PVT demonstrates more than a sheer possibility that Apple was aware of the asserted patent. One can reasonably infer that the former SRI employees, who themselves knew of the '659 patent, later had a connection to Apple's willful infringement."

Accordingly, the district court denied the motion to dismiss the willfulness claim.

Potter Voice Technologies v. Apple Inc., et al., Case No. C 13-1710 CW (N.D. Cal.)

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Jeffer Mangels Butler & Mitchell LLP | Attorney Advertising

Written by:

Jeffer Mangels Butler & Mitchell LLP
Contact
more
less

Jeffer Mangels Butler & Mitchell LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
Feedback? Tell us what you think of the new jdsupra.com!