New Pacer--MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT OR DECLARATORY JUDGMENT AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION
ACER, INC., ACER AMERICA
CORPORATION and GATEWAY, INC.,
Plaintiffs,
v.
TECHNOLOGY PROPERTIES LIMITED, PATRIOT SCIENTIFIC CORPORATION, and ALLIACENSE LIMITED,
Defendants.
MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT OR DECLARATORY JUDGMENT AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT
OF MOTION
Date: December 19, 2008
Time: 9:00 a.m.
Dept: Courtroom 3, 5th Floor
Before: Honorable Jeremy Fogel
NOTICE OF MOTION AND MOTION TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:
PLEASE TAKE NOTICE that on December 19, 2008 at 9:00 AM, or as soon thereafter as counsel may be heard by the above-titled court, located at 280 South 1st Street, San Jose, CA 95113, Plaintiffs ACER, INC., ACER AMERICA CORPORATION and GATEWAY, INC. c(“Plaintiffs”) will and hereby do move the Court for leave to file their First Amended Complaint pursuant to Federal Rule of Civil Procedure 15(a). By this Motion, Plaintiffs respectfully move this Court for leave to amend its complaint to include two additional patents asserted by Defendants against Plaintiffs that relate to the Moore Microprocessor Portfolio (“MMP”). A copy of Samsung’s proposed First Amended complaint is attached hereto as Exhibit A. This motion is made on the grounds that: (1) the amendments will not prejudice Defendants, (2) Plaintiffs have not unreasonably delayed in seeking this motion; (3) the amendment is not sought in bad faith; and (4) denial of the motion will cause substantial prejudice to Plaintiffs.
Dated: November 14, 2008
K&L Gates LLP
By: /s/ Harold H. Davis /s/
Harold H. Davis
Attorneys for Plaintiffs
ACER, INC., ACER AMERICA
CORPORATION and GATEWAY, INC.
MEMORANDUM OF POINTS AND AUTHORITIES
I. INTRODUCTION
Plaintiffs bring the present motion to amend its complaint to add two additional patents – 6,598,148 (“‘148 patent”) and 5,530,890 (“‘890 patent”) – that are part of the so-called Moore Microprocessor Portfolio (“MMP”) that have been asserted against Plaintiffs. These additional patents relate to the same technology already at issue in Plaintiffs’ pending complaint and are bundled by Defendants into a single portfolio for licensing purposes. Moreover, Plaintiffs HTC and Asustek have made a nearly identical amendment to their complaints in the related actions. See Case No. 08-882 [Dkt. No. 34] and Case No. 08-884 [Dkt. Nos. 56, 58, 60]. Since Federal Rule 15(a) requires that leave to amend should be freely granted where justice requires, Plaintiffs’ motion should be granted because the addition of the additional patents will not burden Defendants and will ensure the complete adjudication of the claims in this case.
II. FACTS
On February 8, 2008, Plaintiffs filed its complaint for declaratory judgment regarding United States Patent 5,809,336; 5,784,584; and 5,440,749. On April 25, 2008, Plaintiffs’ filed a motion to dismiss the complaint, and discovery was stayed pending the outcome of the motion to dismiss. Subsequently, Plaintiffs learned that Defendants were also asserting that Plaintiffs infringed the ‘148 and ‘890 patents. Plaintiffs timely met and conferred with Defendants on multiple occasions to seek a stipulation to file an amended complaint. See Declaration of Harold H. Davis in Support of Motion for Leave to Amend, 2 (“Davis Decl.”); 7/18/08 Joint Case Management State at p. 2-3 [Dkt. No. 42]; 11/5/08 Joint Case Management Statement, pg. 3:15-21 and Section 5 [Dkt. No. 48]. Defendants have refused to take a position whether they would stipulate or oppose Plaintiffs’ motion to amend. Id. On November 7, the Court held the most recent case management conference. There, counsel for Plaintiffs raised the issue of amending the complaint to add the two patents, explaining that Defendants had not responded to requests for a stipulation. Counsel for Defendants indicated that the amendment issue “was not pressing”: November 7, 2008 Transcript of Hearing [Dkt. No. 51] at p. 6. The Court entered a case scheduling order adopting the proposals set forth in the parties’ 11/5/08 Joint Case Management Statement. The parties have not yet exchanged their initial disclosures, and no discovery has been commenced.
III. ARGUMENT
The Court should grant Plaintiffs’ motion for leave to add the ‘148 and ‘890 patents to this case because: (1) the addition of the patents will not prejudice Defendants as they are already
litigating those patents with respect to the HTC and Asustek parties in related cases before this Court; (2) Defendants have already asserted the two patents against Plaintiffs in the United States District Court for the Eastern District of Texas; (3) Plaintiffs’ timely brought this motion after efforts to negotiate a stipulation to add the patents; (4) Plaintiffs’ amendment will ensure the complete and efficient adjudication of all of the claims and asserted technology before this court; and (5) Plaintiffs will suffer prejudice if the Court does not Grant their motion. Although the Court has entered a Case Management Order, neither the Case Management order nor the other pretrial orders in this case establish a cut-off date for amending pleadings. The Joint Case Management Statement, however, explicitly contemplate Plaintiffs filing of a motion for leave to file an amended complaint. See [Dkt. No. 48]. Also, the issue was raised during the hearing, and Defendants’ counsel stated “it was not pressing.” November 7, 2008 Transcript of Hearing [Dkt. No. 51] at p. 6. Accordingly, the Court should exercise “extreme liberality” when allowing an amendment of the pleadings. Owens v. Kaiser Found. Health Plan, Inc., 244 F.3d 708, 713 (9th Cir. 2001). Without a showing of prejudice or other factors, “there exists a presumption under Rule 15(a) in
favor of granting leave to amend.” Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). “The party opposing amendment bears the burden of showing prejudice.” DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 187 (9th Cir. 1987) (reversing district court’s denial of motion to amend complaint to add defendants); Bowles v. Reade, 198 F.3d 752, 757-58 (9th Cir. 1999) (noting that the Ninth Circuit has reversed denials of motions to amend where no specific findings of prejudice, bad faith or futility were made). Defendants will not suffer any prejudice from the addition of the two MMP patents to this case because they will litigate them in the related Asustek and HTC actions, and have asserted them against Plaintiffs in Texas. There is no prejudice due to the timing of the motion because Defendants have not responded to requests for a stipulation since at least July 18, 2008, and Defendants’ counsel stated at the hearing that the amendment “is not pressing”. The proposed amended complaint will not delay the case as the parties will have just exchanged preliminary disclosures, Defendants will have provided preliminary infringement contentions on the three patents already in the suit, and no discovery will have proceeded. The schedule adopted by the Court has not yet set a date for the claim construction hearing. Although Defendants will be required to submit infringement contentions on the additional patents as a part of the claim construction proceedings, the only dates set in the schedule are dates for exchanges between the parties and briefing, which can be adjusted as necessary. There should be little impact on the entered schedule because Defendants will be filing preliminary infringement contentions on the two additional MMP patents in the HTC and Asustek cases. Further, the inclusion of all of the asserted MMP patents in this action will streamline the proceedings and will avoid duplicative actions at a later date – especially since this Court will have to deal with the two additional MMP patents in any event. It is far less prejudicial to the parties to include the additional MMP patents in this action rather than requiring Plaintiffs to file an entirely new complaint against Defendants on these patents. Because there is no prejudice that Defendants can reasonably claim from the amendment of the complaint, Defendants cannot make the showing of substantial prejudice required to overcome Plaintiffs’ motion to amend. Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990) (holding that substantial prejudice is required to deny leave to amend). If Plaintiffs are not permitted to amend its Complaint, Plaintiffs will need to file a separate action against Defendants, which will result in a duplication of judicial resources. A separate action will only serve to increase costs for all parties involved.
IV. CONCLUSION
For the reasons set forth above, Plaintiffs respectfully request that the Court grant their motion for leave to file a first amended complaint.
Dated: November 14, 2008
K&L GATES LLP
By: /s/ Harold H. Davis /s/
Harold H. Davis
Attorneys for Plaintiffs ACER, INC.,
ACER AMERICA CORPORATION
