Judge Saylor of the United States District Court for the District of Massachusetts recently narrowed the counterclaims and affirmative defenses available to a defendant in a consumer products dispute. The decision highlights not only the importance of pleading sufficient facts to meet the applicable standard, but also the potential effect of a parties’ representations when responding to a motion to dismiss.
In late December 2016, Plaintiff PetEdge brought suit against Marketfleet Sourcing, Inc. d/b/a FrontPet for infringement of PetEdge’s patent directed to a “Folding Pet Ramp and Steps.” In response, Marketfleet filed an answer containing a number of affirmative defenses and alleging Non-infringement, Invalidity, and False Marking counterclaims. PetEdge subsequently moved to dismiss the counterclaims and certain affirmative defenses under Federal Rules of Civil Procedure 12(b)(6) and 12(f).To support its false marking allegations, Marketfleet alleged that, prior to the lawsuit, PetEdge sent a deceptive letter that caused it to believe that patent infringement is determined by the similarity of products and that PetEdge’s “Renew Rampsteps” product was patented, when really, it contended, it was not. The court found that those unsupported allegations were insufficient to support a claim of false marking because they relied entirely on a letter from PetEdge, where the patent marking statute, 35 U.S.C. § 292, prohibits deceptive use of the word “patent” only when it is affixed to or used in marketing.
The court also struck Marketfleet’s counterclaim for non-infringement. Marketfleet’s allegations for that counterclaim amounted to no more than a denial of infringement. In order to have stated a plausible non-infringement counterclaim, the court noted, the defendant must do more than deny infringement by pleading sufficient facts to state a plausible claim for relief.
The court was more lenient on portions of Marketfleet’s invalidity counterclaim. There, the court found sufficient facts, including the identification of a prior art patent, to plead invalidity by anticipation and/or obviousness under sections 102 and 103. But, Marketfleet’s conclusory allegations contained no support for its claims under sections 101 and 112, causing the court to strike those portions of its counterclaims.
Marketfleet’s answer also raised several affirmative defenses, all of which were challenged by PetEdge on the basis of sufficiency. While many of the affirmative defenses survived, two, unclean hands and patent misuse, were struck. PetEdge asserted that those defenses sounded in fraud, and were therefore subject to the heightened pleading standard of Federal Rule of Civil Procedure 9. The court noted that the defenses of unclean hands and patent misuse need not always sound in fraud, heightened pleading under Fed. R. Civ. P. 9 is not necessarily required to raise those defenses.
However, in its opposition to the motion to dismiss, Marketfleet’s representations made clear that its unclean hands and patent misuse theories sounded in fraud in this case. Under the heightened pleading standard, Marketfleet’s barebones allegations were insufficient to support these affirmative defenses, which the court struck.
The case is PetEdge, Inc. v. Marketfleet Sourcing, Inc., No. 1:16-cv-12562-FDS, pending in the U.S. District Court for the District of Massachusetts. A copy of the opinion can be found here.