©2017. Published in Landslide, Vol. 10, No. 1, September/October 2017, by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.
Feature
Form 18, I Just Don’t know What I Want: How the Abrogation of Form 18 Has Changed Pleading Standards
By Jeffrey T. Castellano and Nathan R. Hoeschen
On December 1, 2015, a long-standing safe haven for plaintiffs in patent infringement cases was eliminated as part of a partial overhaul of the Federal Rules of Civil Procedure (FRCP).1 The 2015 amendments eliminated Form 18, an exemplary patent infringement complaint appended to the FRCP and adopted in 1938, which consisted solely of four brief paragraphs of factual allegations and a demand.
Form 18 was exceedingly plaintiff-friendly and, some said, out of step with the stricter pleading requirements set out by the Supreme Court in Twombly and Iqbal. But even after those landmark cases changed the meaning of “notice pleading” in federal court, Form 18 remained the touchstone for adequate pleading of direct infringement,2 and plaintiffs that modeled their complaint after Form 18 could be reasonably confident that their complaint would survive a Rule 12(b)(6) motion.3
Whether it was due to the rise of nonpracticing entity (NPE) litigation, the heightened pleading standard of Twombly and Iqbal, or simply that the purpose of the FRCP forms “ha[d] been fulfilled” (as the rules committee stated4), Form 18 was eliminated.5 It was then up to the courts to decide how Twombly and Iqbal would be applied in the patent infringement context. Now, more than a year later, federal courts have laid the groundwork for the treatment of infringement complaints in a post–Form 18 world. While much uncertainty remains, it is clear that the days of pure notice pleading for patent infringement cases are gone.
What Does the Elimination of Form 18 Mean for Pleading Standards?
The District of Delaware appears to have been the first court to elucidate a new requirement for post–Form 18 complaints—the need to explicitly connect the factual allegations to the elements of the claims. In RainDance Technologies, Inc. v. 10x Genomics, Inc., the plaintiff filed an infringement complaint that contained a lengthy description of the accused products (a complex biological lab instrument and related consumables) and how they functioned, complete with numerous diagrams and pictures.6 Perhaps due to the complexity of the technology involved, it was impossible for the court to determine which of the many components of the accused products corresponded to the claims.7 The court dismissed the complaint.8
Subsequently, courts in other popular patent litigation jurisdictions—including the Northern District of Illinois, the Eastern District of Virginia, and the District of New Jersey—adopted this requirement, dismissing complaints that failed to link the elements of the asserted patent claims to the accused devices.9 Several cases have suggested that, in order to meet this requirement, a complaint must specify which particular claims are infringed.10 The Eastern District of Texas, in particular, has published numerous opinions stating that a complaint must “give rise to a plausible inference that a device meets all elements of a specific claim.”11 However, it has not been stern in its application of this rule, declining to dismiss complaints that “do not specify that the accused products infringe every element of a particular claim” where they “identify the central claim limitations.”12 This particularity requirement has also led to an interesting split between districts regarding whether a complaint must allege facts linking the accused products to each asserted claim, or only to one claim per patent.13
Courts in the Northern District of California have expressed similar doubts about the viability of Form 18 pleading, but have generally declined to apply a heightened pleading standard to pending cases.14 Even when applying the new standard, the Northern District of California has not required the same level of detail as other districts, because its local rules require such specificity only in later-served infringement contentions. In Avago Technologies General IP (Singapore) PTE Ltd. v. Asustek Computer, Inc., for instance, the complaint failed to specify which claims of the seven patents-in-suit were infringed or give any description of the manner in which the accused products functioned or how they infringed.15 Despite the sparse nature of these allegations—significantly less detailed than those found wanting in RainDance and similar to those dismissed by other courts under the new standard—Judge Edward Chen denied the motion to dismiss, noting that “this District generally has not required detailed infringement theories until the time that infringement contentions are served.”16 Similarly, the Northern District of California has not required plaintiffs to specify which claims are infringed by which specific products, again deferring to its normal practice of requiring such specificity only when infringement contentions are due under the local rules.17
This reliance upon contentions to fill in the gaps between Form 18 and Twombly pleading has drawn both approval and scorn—often within the same district. Quite recently, one judge in the District of Delaware has approved of the approach, denying a motion to dismiss a complaint that referenced only exemplary products and claims on the grounds that the local rules required such specificity only later in the litigation.18 In a similar display of judicial eclecticism, the District of New Jersey has both endorsed and renounced the practice,19 while the Southern District of Texas has reached an interesting compromise, holding that because its local rules had historically required additional detail only later in the case, it was not “just and practicable” to apply the new standards to complaints filed before the effective date of the amendments.20
The authors found only one case holding that the abrogation of Form 18 had no effect on the operative pleading standard. The plaintiff in Hologram USA, Inc. v. Pulse Evolution Corp. filed an amended complaint that contained allegations notably similar to those rejected by Judge Richard Andrews in RainDance—describing in general terms how the accused products function (“high-powered projectors are used to project an image onto a rear-projection screen, the image reflects of a transparent foil”) but failing to explicitly connect that description to the elements of the claims.21 Judge Gloria Navarro in the District of Nevada took the position that the abrogation of Form 18 had no effect on the underlying pleading standard, relying on a note from the advisory committee that the abrogation “does not alter existing pleading standards.”22 Shortly thereafter, the District of Oregon discussed this same note and reached the opposite conclusion in Tannerite Sports, LLC v. Jerent Enterprises, LLC, reasoning that the advisory committee’s reference to “existing pleading standards” referred to the general standards articulated by the Supreme Court in Twombly and Iqbal.23 Later opinions in the District of Nevada24 and Northern District of California25 also reached the opposite conclusion, dismissing complaints for failing to explain how the accused products met each limitation of the claims without any reference to the earlier decision in Hologram.
When Does Form 18 Still Apply?
A secondary threshold issue that has drawn diverse rulings is whether and when the new standard should be applied to cases that were already pending in the district courts when the new rules took effect. In propounding the new rules, the Supreme Court stated that they should be applied to pending cases “insofar as just and practicable.”26 Seizing upon this language, district courts have most commonly simply held that it would27 or would not28 be “just and practicable” to apply the new standards, with little further analysis or explanation. This has drawn divisions even within the same district.29
The opinion in Tannerite is one of only a few that have devoted any analysis to the question and noted the Supreme Court’s statement that the amended rules would govern all pending proceedings “insofar as just and practicable.”30 Tannerite interpreted the Supreme Court’s order adopting the amendments as setting forth a “general rule” that they apply to pending cases, with an exception only where their application would be “unjust and/or not-practicable.”31 The only other case to discuss the issue in any depth, Polaris Industries, Inc. v. Arctic Cat Inc., reached the opposite conclusion.32 Beginning from the general premise that applying new procedural rules retroactively is neither “just” nor “practicable,” the Polaris court went on to note several exceptions such as when a new rule merely restyles an old, in discovery disputes where the rule will have to be applied to future disputes in the same action, and when “the new rule’s very purpose [is] to prevent the application of the old rules.”33 Ultimately, however, the court found that none of these exceptions applied, and noted that requiring the plaintiff to replead a case to meet new pleading requirements “would further delay litigation.”34
Conclusion
In conclusion, although a general consensus exists among the most popular patent districts that the abrogation of Form 18 has heightened the bar for pleading infringement,35 there remains a great deal of dispute about exactly how the standard should be applied and to whom. Presently, it is difficult to predict whether a pleading filed before the rules change will be subject to a heightened standard. As to the scope of that heightened standard, at least some judges in Delaware, the Northern District of Illinois, and New Jersey are apt to dismiss complaints that fail to explain how the accused products infringe the claims (or to allege which claims are infringed), while judges in the Northern District of California are more likely to allow complaints tracking Form 18 to survive, leaving it to their patent local rules to draw out the details of plaintiffs’ infringement allegations.
Endnotes
1. See Fed. R. Civ. P. historical note; id. at appendix of forms (noting abrogation).
2. In re Bill of Lading Transmission & Processing Sys. Patent Litig., 681 F.3d 1323, 1334–35 (Fed. Cir. 2012) (“[T]o the extent the parties argue that Twombly and its progeny conflict with the Forms and create differing pleadings requirements, the Forms control. . . . Form 18 and the Federal Rules of Civil Procedure do not require a plaintiff to plead facts establishing that each element of an asserted claim is met. Indeed, a plaintiff need not even identify which claims it asserts are being infringed.” (citation omitted)). But see id. at 1348–49 (Newman, J., dissenting) (collecting district court cases finding that “Twombly and Iqbal apply, to the exclusion of Form 18”).
3. K-Tech Telecomms., Inc. v. Time Warner Cable, Inc., 714 F.3d 1277, 1283 (Fed. Cir. 2013) (“[P]roper use of [Form 18] effectively immunizes a claimant from attack regarding the sufficiency of the pleading.”).
4. Fed. R. Civ. P. 84 advisory committee’s note to 2015 amendment.
5. The rules committee was plainly aware of the apparent conflict between Form 18 and Twombly/Iqbal. See In re Bill of Lading Transmission, 681 F.3d at 1350 (Newman, J., dissenting) (discussing references in committee minutes to conflict between Twombly/Iqbal pleading standard and Form 18).
6. No. 15-cv-152, 2016 WL 927143, at *1 (D. Del. Mar. 4, 2016).
7. Id. at *2 (“It is not obvious to me that what Plaintiffs describe is an ‘autocatalytic reaction.’ . . . I think, but am not sure, that partitioning samples is the same as amplification.”).
8. Id.
9. See, e.g., Robern, Inc. v. Glasscrafters, Inc., 206 F. Supp. 3d 1005, 1011 (D.N.J. 2016) (dismissing complaint that “failed to relate factual assertions to the pertinent claims in the . . . patent”); Atlas IP, LLC v. City of Naperville (Atlas I), No. 15 C 10744, 2016 WL 3907029, at *3–4 (N.D. Ill. July 19, 2016) (dismissing a formulaic complaint for “fail[ing] to allege how the accused products practice, or contain an equivalent of, each limitation of representative claim 1”).
10. See, e.g., Jenkins v. LogicMark, LLC, No. 3:16-CV-751-HEH, 2017 U.S. Dist. LEXIS 10975, at *6–7 (E.D. Va. Jan. 25, 2017) (dismissing complaint where the defendant was “unable to defend itself properly as it would be forced to gaze into a crystal ball in order to discern which of the many claims of the asserted patents its products allegedly infringe”); Atlas IP, LLC v. Exelon Corp. (Atlas II), 189 F. Supp. 3d 768, 775 (N.D. Ill. 2016) (“[I]t is difficult to imagine how an action for infringement could be brought without a tentative but nonetheless coherent theory of which claims are allegedly infringed and how the accused products practice . . . each of [the asserted] claims’ elements.”); Asghari-Kamrani v. United Servs. Auto. Ass’n, No. 2:15cv478, 2016 WL 1253533, at *4 (E.D. Va. Mar. 22, 2016) (dismissing complaint that alleged infringement of multiple claims for failing to explain how the individual claims were infringed).
11. See, e.g., Raytheon Co. v. Cray, Inc., No. 2:16-CV-00423-JRG-RSP, 2017 U.S. Dist. LEXIS 56729, at *10 (E.D. Tex. Mar. 12, 2017); Huawei Techs. Co. v. T-Mobile US, Inc., No. 2:16-CV-00052-JRG-RSP, 2017 U.S. Dist. LEXIS 43240, at *19 (E.D. Tex. Feb. 20, 2017); PanOptis Patent Mgmt., LLC v. BlackBerry Corp., No. 2:16-CV-00059-JRG-RSP, 2017 U.S. Dist. LEXIS 27756, at *10 (E.D. Tex. Feb. 10, 2017).
12. Semcon IP, Inc. v. Huawei Device USA, Inc., No. 2:16-cv-00437-JRG-RSP, 2017 U.S. Dist. LEXIS 37035, at *19 (E.D. Tex. Feb. 20, 2017). In fact, the authors have located no cases from the Eastern District of Texas dismissing a complaint for failing to comply with the new pleading standard.
13. Compare Cont’l Circuits LLC v. Intel Corp., No. CV16-2026 PHX DGC, 2017 U.S. Dist. LEXIS 23842, at *12 (D. Ariz. Feb. 21, 2017) (“Nor is Plaintiff required, as Defendants maintain, to allege facts supporting every limitation of every claim in each of the four patents-in-suit.”), with Oil-Dri Corp. v. Nestle Purina Petcare Co., No. 15-cv-1067, 2017 U.S. Dist. LEXIS 48358, at *13 (N.D. Ill. Mar. 31, 2017) (“It makes little sense that a plaintiff could plead infringement as to one patent claim and then proceed in the litigation with respect to every other materially different claim in the patent.”).
14. See, e.g., Bluestone Innovations LLC v. Bulbrite Indus., Inc., No. 15-CV-5478-PJH, 2016 WL 1535059, at *3 (N.D. Cal. Apr. 15, 2016) (“At the time that Bluestone filed the complaint, Form 18 was still operative and controlling. With regard to the allegations of direct infringement, the complaint includes all the allegations required by Form 18 . . . .”).
15. No. 15-cv-04525-EMC, 2016 WL 1623920, at *4 (N.D. Cal. Apr. 25, 2016).
16. Id. But see e.Digital Corp. v. iBABY Labs, Inc., No. 15-CV-05790-JST, 2016 WL 4427209, at *3 (N.D. Cal. Aug. 22, 2016) (granting motion to dismiss where the plaintiff failed to provide a limitation-by-limitation analysis of how accused products infringed at least one exemplary claim).
17. See Windy City Innovations, LLC v. Microsoft Corp., 193 F. Supp. 3d 1109, 1115 (N.D. Cal. 2016) (“[D]efendant’s argument that it should be entitled to notice at the pleading stage of which specific products infringed on which specific claims in the patents is belied by both the local patent rules and Federal Circuit authority.”). But see Rembrandt Patent Innovations LLC v. Apple Inc., No. C 14-05094 WHA, 2015 WL 8607390, at *3 (N.D. Cal. Dec. 13, 2015) (noting that following abrogation of Form 18 the plaintiff was required to amend its complaint, rather than just merely its infringement contentions, when it became aware of new infringing products). Although the complaints in Avago and Windy City were both filed prior to the abrogation of Form 18, neither court specifically ruled that a new standard applied. Instead, both courts simply “assumed” for the sake of the motion that the new standard applied. Windy City, 193 F. Supp. 3d at 1115; Avago, 2016 WL 1623920, at *4.
18. This opinion from Judge Gregory Sleet did not reference the apparently divergent holding Judge Andrews reached in RainDance. Koninklijke Philips N.V. v. ASUSTeK Comput. Inc., No. CV 15-1125-GMS, 2016 WL 6246763, at *3 (D. Del. Oct. 25, 2016).
19. Compare Robern, Inc. v. Glasscrafters, Inc., 206 F. Supp. 3d 1005, 1011 (D.N.J. 2016) (“[A]fter-the-fact disclosures cannot be used to supplement the pleadings and meet the Iqbal/Twombly standard.”), with Telebrands Corp. v. Ragner Tech. Corp., No. 15-3163 (ES), 2016 U.S. Dist. LEXIS 114436, at *17 (D.N.J. Aug. 25, 2016) (“[T]he Court turns to the Local Patent Rules—just as the Windy City Innovations court did—to inform the propriety of its ruling.”).
20. Lubrizol Specialty Prods., Inc. v. Flowchem LLC, 165 F. Supp. 3d 534, 538 (S.D. Tex. 2016).
21. No. 2:14-cv-0772-GMN-NJK, 2016 WL 199417, at *1–2 (D. Nev. Jan. 15, 2016).
22. Id. at *2 n.1 (quoting Fed. R. Civ. P. 84 advisory committee’s note to 2015 amendment).
23. No. 6:15-cv-00180-AA, 2016 WL 1737740, at *3 (D. Or. May 2, 2016).
24. CG Tech. Dev., LLC v. FanDuel, Inc., No. 2:16-cv-00801-RCJ-VCF, 2016 WL 6089693, at *3 (D. Nev. Oct. 18, 2016) (“Form 18 and Rule 84 (authorizing the form) were deleted from the Civil Rules in 2015, extinguishing the exception to the Twombly/Iqbal pleading standard for direct infringement claims.”).
25. e.Digital Corp. v. iBABY Labs, Inc., No. 15-CV-05790-JST, 2016 WL 4427209, at *3 (N.D. Cal. Aug. 22, 2016).
26. Order Amending Federal Rules of Civil Procedure (U.S. Apr. 29, 2015).
27. See, e.g., Erfindergemeinschaft Uropep GbR v. Eli Lilly & Co., No. 2:15-CV-1202-WCB, 2016 WL 1643315, at *4 n.3 (E.D. Tex. Apr. 26, 2016); RainDance Techs., Inc. v. 10x Genomics, Inc., No. 15-152-RGA, 2016 WL 927143, at *2 (D. Del. Mar. 4, 2016).
28. See, e.g., Gym Door Repairs, Inc. v. Young Equip. Sales, Inc., No. 15-cv-4244 (JGK), 2016 WL 4747281, at *6 (S.D.N.Y. Sept. 12, 2016), reconsideration denied, No. 15-CV-4244 (JGK), 2016 WL 6652733 (S.D.N.Y. Nov. 10, 2016); Imation Corp. v. Sanho Corp., No. 15-1883 (JRT/JSM), 2016 WL 4179363, at *3–4 (D. Minn. Aug. 5, 2016); Nexeon Ltd. v. Eaglepicher Techs., LLC, No. 15-955-RGA-MPT, 2016 WL 4045474, at *4 (D. Del. July 26, 2016).
29. Compare RainDance, 2016 WL 927143, at *2 (“[I]t would be in the interest of justice to [apply the new pleading standards].”), with Nexeon, 2016 WL 4045474, at *4 (“In the interest of justice and practicability, Form 18 should still be used to analyze the sufficiency of the pleadings.”).
30. Tannerite Sports, LLC v. Jerent Enters., LLC, No. 6:15-cv-00180-AA, 2016 WL 1737740, at *2–5 (D. Or. May 2, 2016).
31. Id. at *4.
32. No. 15-4129 (JRT/LIB), 2016 WL 3541541, at *1–2 (D. Minn. June 23, 2016).
33. Id. at *2.
34. Id.
35. Interestingly, a small smattering of courts appear to be applying a standard lower than formerly required by Form 18, requiring plaintiffs only to allege that the defendants’ products “perform the same unique function as Plaintiff’s patented system.” InCom Corp. v. Walt Disney Co., No. CV15-3011 PSG (MRWx), 2016 U.S. Dist. LEXIS 71319, at *8 (C.D. Cal. Feb. 4, 2016); SimpliVity Corp. v. Springpath, Inc., No. 4:15-13345-TSH, 2016 U.S. Dist. LEXIS 155017, at *15–16 (D. Mass. July 15, 2016) (finding complaint plausible because it alleged “that the accused product ‘also do[es] what the patent does’” (quoting InCom)); see also Wright’s Well Control Servs., LLC v. Oceaneering Int’l, Inc., No. 15-1720, 2017 U.S. Dist. LEXIS 19815, at *11 (E.D. La. Feb. 13, 2017) (criticizing this approach because it “resembles the minimal requirements of now-defunct Form 18”).