Opinion
23-cv-04823-EKL (VKD)
11-08-2024
CHROMACODE, INC., et al., Plaintiffs, v. BIO-RAD LABORATORIES, INC., Defendant.
ORDER GRANTING CHROMACODE'S MOTION FOR LEAVE TO AMEND INVALIDITY CONTENTIONS RE: DKT. NO. 68
Virginia K. DeMarchi United States Magistrate Judge
In connection with its invalidity defenses against patents asserted by defendant and counter-plaintiff Bio-Rad Laboratories, Inc. (“Bio-Rad”), plaintiff and counter-defendant ChromaCode, Inc. (“ChromaCode”) seeks leave to amend its invalidity contentions to add contentions identifying three claim terms as indefinite. Dkt. No. 68; see Dkt. No. 40 at 6. Bio-Rad opposes the motion. Dkt. No. 74. The Court held a hearing on the motion on September 17, 2024. Dkt. No. 81. For the reasons explained below, the Court grants ChromaCode's motion for leave to amend.
I. BACKGROUND
In its counterclaim in this patent infringement action, Bio-Rad asserts infringement of two patents, U.S. Patent No. 9,222,128 (“the '128 patent”) and U.S. Patent No. 9,921,154 (“the '154 patent”). Dkt. No. 27 at 9-15. Pursuant to Patent Local Rule 3-3, ChromaCode served preliminary invalidity contentions regarding Bio-Rad's asserted patents on February 5, 2024, and then (apparently, by agreement of the parties) revised invalidity contentions on February 29, 2024. See Dkt. No. 68-1 ¶¶ 3-6; Dkt. No. 74-2; Dkt. No. 74-3. ChromaCode's February 29, 2024 invalidity contentions identified several claim terms in each of Bio-Rad's asserted patents as invalid for indefiniteness under 35 U.S.C. § 112, in addition to other invalidity contentions. See Dkt. No. 74-3 at 10-12.
On March 7, 2024, pursuant to Patent Local Rule 4-1, ChromaCode identified several terms requiring claim construction, including the following:
• “determining a total number of amplification-positive partitions for each type of the more than R targets” ('128 patent)
• “generally parallel” ('154 patent)
• “a different plurality of the partitions contains each different pair of the R targets” ('154 patent)Dkt. No. 68-1 ¶ 7. On March 19, 2024, pursuant to Patent Local Rule 4-2, ChromaCode served its preliminary claim constructions, identifying these three terms as “indefinite.” Id. ¶ 8. ChromaCode did not include indefiniteness contentions as to these three terms in its February 5, 2024 or February 29, 2024 invalidity contentions. Dkt. No. 68 at 1.
On April 5, 2024, the parties filed their joint claim construction statement pursuant to Patent Local Rule 4-3. Dkt. No. 51. That statement included each of the three terms listed above as well as the parties' respective claim construction positions for each term. See id. at 8-10. The statement indicated that neither party expected to call witnesses at the claim construction hearing, and that neither party requested any factual findings by the presiding judge. See id. at 10.
As reflected in the joint claim construction statement, the first of the three terms was truncated to “each type of the more than R targets.” Dkt. No. 51 at 8.
Between May 20, 2024 and June 18, 2024, the parties briefed the construction of the claim terms in dispute, including the three terms listed above. See Dkt. Nos. 54, 59, 64. In its opening claim construction brief, Bio-Rad objected that ChromaCode had failed to include its indefiniteness contentions as to the three terms in ChromaCode's earlier invalidity contentions, but Bio-Rad also argued against finding the terms indefinite on the merits. Dkt. No. 54 at 10-13, 1722. On June 5, 2024, ChromaCode asked Bio-Rad to stipulate that ChromaCode be permitted to amend its invalidity contentions to include indefiniteness contentions for the three terms. Dkt. No. 68-1 ¶ 11. Bio-Rad declined to so stipulate. Id. ChromaCode briefed the merits of its indefiniteness positions in its responsive claim construction brief. Dkt. No. 59 at 19-22, 23-25. Bio-Rad again addressed the merits of ChromaCode's indefiniteness positions in Bio-Rad's reply claim construction brief. Dkt. No. 64 at 7-9, 11-13. A claim construction hearing is set for December 12, 2024 before the presiding judge. Dkt. No. 88.
II. LEGAL STANDARD
The Patent Local Rules seek to “balance the right to develop new information in discovery with the need for certainty as to the legal theories.” O2 Micro Int'l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d 1355, 1366 (Fed. Cir. 2006). Invalidity contentions therefore may be amended “only by order of the Court upon a timely showing of good cause.” Patent L.R. 3-6.
In assessing whether good cause exists, the Court considers whether the moving party was diligent in seeking to amend its contentions, and whether the non-moving party would suffer prejudice if the amendment were permitted. See Barco N.V. v. Tech. Properties Ltd., No. 5:08-cv-05398 JF HRL, 2011 WL 3957390, at *1 (N.D. Cal. Sept. 7, 2011). To established diligence, a party generally must show both diligence in discovering the basis for amendment and diligence in seeking amendment once the basis for amendment has been discovered. Positive Techs., Inc. v. Sony Elecs., Inc., No. 11-cv-2226 SI, 2013 WL 322556, at *2 (N.D. Cal. Jan. 28, 2013). “If the court determines that the moving party was not diligent, the inquiry may end there.” Twilio, Inc. v. Telesign Corp., No. 16-cv-06925-LHK (SVK), 2017 WL 3581186, at *2 (N.D. Cal. Aug. 18, 2017) (citation omitted). “However, the court retains discretion to grant leave to amend in the absence of diligence where there is no prejudice to the opposing party.” Id. (citations omitted); see also Karl Storz Endoscopy-Am., Inc. v. Stryker Corp., No. 14-cv-00876-RS (JSC), 2016 WL 2855260, at *7 (N.D. Cal. May 13, 2016) (collecting cases).
III. DISCUSSION
The Court first considers whether ChromaCode was diligent in seeking to amend its invalidity contentions, and then considers whether Bio-Rad would suffer prejudice if amendment is permitted.
A. Diligence
Patent Local Rule 3-3 requires a party opposing a claim of patent infringement to disclose its invalidity contentions, including “[a]ny grounds of invalidity based on . . . indefiniteness under 35 U.S.C. § 112(2)” for any asserted claim. Patent L.R. 3-3(d). There is no dispute that ChromaCode should have disclosed its contention that the three claim terms at issue are indefinite in its February 29, 2024 invalidity contentions, if not before. Dkt. No. 68 at 1. However, the parties appear to disagree regarding what information Patent Local Rule 3-3(d) requires a party to disclose about its indefiniteness positions. Bio-Rad seems to suggest that a party must provide “some sort of explanation” about why it believes a claim term is indefinite. See Dkt. No. 74 at 9; see also id. at 2, 5. ChromaCode seems to suggest that a party need only disclose the specific terms it contends are indefinite. See Dkt. No. 68 at 7; Dkt. No. 76 at 5 n.1. No party cites any relevant authority regarding what kind of disclosure is sufficient to satisfy Patent Local Rule 3-3(d) for indefiniteness. The Court notes that other judges in this District have found that a party's disclosure of the specific claim term that renders an asserted claim indefinite satisfies the Rule. See, e.g., Karl Storz Endoscopy-Am., Inc. v. Stryker Corp., No. 14-cv-00876-RS (JSC), 2017 WL 5257001, at *3, *5 (N.D. Cal. Nov. 13, 2017); cf. NobelBiz, Inc. v. LiveVox, Inc., No. 13-cv-1773-YGR, 2015 WL 225223, at *8 (N.D. Cal. Jan. 16, 2015) (finding contentions insufficient where “defendants did not identify the term ‘geographic region' as the source of indefiniteness, but rather included the entirety of a lengthier phrase”); Rambus Inc. v. NVIDIA Corp., No. 08-cv-03343 SI, 2011 WL 13249391, at *9 (N.D. Cal. Nov. 29, 2011) (finding contentions insufficient where party relied on qualified language, and did not “specifically identify the precise limitations alleged to be indefinite”).
As ChromaCode observes, Bio-Rad's own invalidity contentions in related case No. 23-cv-6360-EKL include only an identification of each claim term alleged to be indefinite and a citation to the statute. See Dkt. No. 68 at 7; Dkt. No. 68-3.
Bio-Rad does not dispute that ChromaCode disclosed to Bio-Rad its position that the three terms at issue were indefinite on March 19, 2024-19 days after ChromaCode served its revised invalidity contentions. Dkt. No. 68 at 7; Dkt. No. 74 at 2. While ChromaCode disclosed this position as part of its Patent Local Rule 4-2 claim construction disclosure, and not in its Patent Local Rule 3-3 invalidity contentions, the content of the disclosure was no different than what would have been necessary to satisfy the requirements of Patent Local Rule 3-3(d) for indefiniteness. ChromaCode acknowledges that it made a mistake in not including its indefiniteness position on these three terms in its invalidity contentions but explains that “as it analyzed the potential constructions for these terms, [it] concluded that they were indefinite.” Dkt. No. 76 at 5. The Court finds that ChromaCode was diligent in discovering the basis for its indefiniteness position as to the three terms at issue and promptly disclosed its indefiniteness position to Bio-Rad thereafter.
ChromaCode was not so prompt in seeking leave to amend its invalidity contentions. The parties agree that Bio-Rad first objected to ChromaCode's indefiniteness arguments on May 20, 2024 when Bio-Rad filed its opening claim construction brief. Dkt. No. 68 at 4; Dkt. No. 74 at 2. ChromaCode sought Bio-Rad's consent to amend its invalidity contentions to address this objection on June 5, 2024, which was refused on June 12, 2024. Dkt. No. 68-1 ¶ 11. Whether this refusal was reasonable or not is irrelevant to whether ChromaCode diligently sought leave to amend. ChromaCode's explanations for why it waited until August 8, 2024 to seek leave-i.e. limited resources, briefing claim construction, participating in a settlement conference (see Dkt. No. 76 at 2)-are not particularly compelling. See Dkt. No. 76 at 2. In short, the Court finds that ChromaCode was not diligent in seeking leave to amend.
Critical to resolution of this motion is the Court's finding that ChromaCode fully disclosed its indefiniteness position regarding the three terms to Bio-Rad shortly after ChromaCode served its invalidity contentions. Thus, while ChromaCode was not diligent in seeking leave to amend its invalidity contentions to conform them to the indefiniteness arguments disclosed during the parties' preparations for claim construction, the Court finds that ChromaCode was diligent in discovering the basis for contending these terms are indefinite and in formally disclosing its indefiniteness position to Bio-Rad. To find that ChromaCode was not diligent in these circumstances and should therefore be prevented from amending its contentions would be to elevate form over substance. The Court declines to find lack of diligence here. See, e.g., Facebook, Inc. v. BlackBerry Ltd., No. 18-cv-05434-JSW (JSC), 2020 WL 864934, at *10 (N.D. Cal. Feb. 13, 2020), report and recommendation adopted, No. 18-cv-05434-JSW, 2020 WL 9422395 (N.D. Cal. Mar. 30, 2020) (finding no lack of diligence where, among other things, opposing party had notice of proposed amendments for over one month prior to claim construction hearing); 24/7 Customer, Inc. v. Liveperson, Inc., No. 15-cv-02897 JST (KAW), 2016 WL 6673983, at *3 (N.D. Cal. Nov. 14, 2016) (finding no lack of diligence where defendant “informed [plaintiff] of its new § 112 position one month after it served the initial invalidity contentions, and sought to meet and confer regarding the supplemental contentions a little more than one month later . . . prior to the close of claim construction discovery”); see also The Bd. of Trustees of Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., No. 05-cv-04158 MHP, 2008 WL 624771, at *3 (N.D. Cal. Mar. 4, 2008) (finding that while plaintiff was “arguably not diligent in pursuing the amendment with this court, it was diligent in notifying and seeking discovery from [defendant]” with respect to infringement contentions).
Illumina Inc. v. BGI Genomics Co., No. 20-cv-01465-WHO, 2020 WL 6891818 (N.D. Cal. Nov. 24, 2020) could be read as supporting a different conclusion on the question of diligence. Addressing the parties' claim construction arguments, not a motion for leave to amend, the court in that case found that defendant had “waived the right to assert [an] indefiniteness challenge” because it had not disclosed its indefiniteness arguments in its invalidity contentions, but only during preparations for claim construction. Illumina, 2020 WL 6891818, at *8. However, in reaching this conclusion, the court observed:
[T]he Patent Local Rules lay out a particular process and standard for amending contentions that [defendant] has not followed, allowing a party to amend invalidity contentions “by order of the Court upon a timely showing of good cause.”....[Defendant] has not attempted to amend its invalidity contentions or to make out a showing of “good cause” to do so. It offers no explanation as to why it did not include this challenge in its initial invalidity contentions and has not sought leave of court to make any such amendment, undermining a potential argument that it has diligently sought to amend.Id. Thus, the court in Illumina was not asked to decide whether leave to amend should be given, as ChromaCode asks here, but instead considered whether it should find a waiver on the merits in resolving the parties' claim construction dispute. ChromaCode did not make the same mistake as the defendant in Illumina, in so far as ChromaCode now seeks leave to amend its invalidity contentions to conform to its claim construction disclosures.
B. Prejudice
ChromaCode argues that permitting amendment will not prejudice Bio-Rad. ChromaCode observes that Bio-Rad had notice of ChromaCode's indefiniteness position with respect to the three claim terms at issue two months before the parties began claim construction briefing. It argues that Bio-Rad could have taken discovery or otherwise sought further information regarding ChromaCode's indefiniteness position before filing its opening claim construction brief, but that Bio-Rad elected not to do so. ChromaCode argues that, in any event, Bio-Rad had ample opportunity to brief, and did brief, indefiniteness on the merits. Dkt. No. 68 at 3-4, 6-7.
Bio-Rad does not dispute that it neither objected to, nor sought information about, ChromaCode's indefiniteness position for the three claim terms before Bio-Rad filed its opening claim construction brief. Nevertheless, Bio-Rad argues that it suffered prejudice because it “was forced to blindly address unexplained invalidity contentions in its opening claim construction brief”-i.e. ChromaCode's position that the three terms are indefinite-and “then only had one opportunity to address ChromaCode's positions[] in its reply claim construction brief . . .” Dkt. No. 74 at 9.
Bio-Rad's prejudice arguments are unpersuasive. If, as the Court finds above, ChromaCode's Patent Local Rule 4-2 claim construction disclosure included the same information about its indefiniteness position that Patent Local Rule 3-3(d) requires-i.e. identification of the specific terms a party contends are indefinite-it is simply not plausible that Bio-Rad suffered prejudice in briefing claim construction solely because it got that information 19 days late. If BioRad was “blind” to the specific arguments ChromaCode intended to advance in support of its indefiniteness position, Bio-Rad bears at least some of the blame for its predicament because it failed to inquire or to adequately confer with ChromaCode about construction of the three terms, as the Patent Local Rules require. See Patent L.R. 4-2(c) (After exchanging preliminary claim constructions, “[t]he parties shall . . . meet and confer for the purposes of narrowing the issues and finalizing preparation of a Joint Claim Construction and Prehearing Statement.”).
Importantly, ChromaCode's indefiniteness arguments as to the three terms at issue do not rely on expert testimony or any other extrinsic evidence. And Bio-Rad does not contend that it requires expert testimony or any discovery to oppose ChromaCode's arguments. Instead, the parties rely solely on legal argument and intrinsic evidence for their respective positions as to these three terms. See Dkt. Nos. 54, 59, 64. Thus, this is not the kind of case where Bio-Rad was prevented by a late disclosure from developing evidence necessary to respond to ChromaCode's indefiniteness arguments. The Court does not suggest that disclosure of an indefiniteness position as part of the exchanges required by Patent Local Rules 4-1 and 4-2 always eliminates any prejudice to the patentee where an accused infringer has failed to timely disclose an indefiniteness position in its invalidity contentions. Rather, in the circumstances presented here, the Court finds that Bio-Rad did not suffer prejudice in briefing claim construction or otherwise.
With respect to Bio-Rad's remaining argument that it was constrained by page limitations from fully addressing ChromaCode's indefiniteness arguments on the merits in its reply claim construction brief, Bio-Rad could have sought relief from the presiding judge on that point but did not. Bio-Rad does not explain what arguments it would have briefed during claim construction had it had more pages to do so. Accordingly, the Court finds this argument unpersuasive.
Thus, the Court concludes that, even if ChromaCode was not diligent in seeking leave to amend, it was diligent in promptly discovering and formally disclosing its indefiniteness position to Bio-Rad, and Bio-Rad was not prejudiced by the timing of ChromaCode's disclosure. The Court exercises its discretion to permit the amendment. See Twilio, 2017 WL 3581186, at *2; Karl Storz Endoscopy-Am., 2016 WL 2855260, at *7.
IV. CONCLUSION
The Court grants ChromaCode's motion for leave to amend its invalidity contentions to add contentions identifying the three claim terms listed above as indefinite. ChromaCode shall serve its amended invalidity contentions on Bio-Rad by November 15, 2024.
IT IS SO ORDERED.