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McDavid Knee Guard, Inc. v. Nike USA

January 14, 2010

MCDAVID KNEE GUARD, INC., AND STIRLING MOULDINGS LIMITED, PLAINTIFFS,
v.
NIKE USA, INC., DEFENDANT.



The opinion of the court was delivered by: James F. Holderman, Chief Judge

MEMORANDUM OPINION AND ORDER DENYING MOTION FOR LEAVE TO FILE SECOND AMENDED COMPLAINT

Plaintiffs McDavid Knee Guard, Inc. and Stirling Mouldings Limited (collectively "McDavid") initiated this action against defendant Nike USA, Inc. ("Nike") on November 17, 2008, alleging that the process of producing Nike's "ProCombat" product line infringed U.S. Patent No. 6,743,325 ("'325 Patent"). On September 17, 2009, this court issued its claim construction opinion construing the disputed claim terms in the '325 Patent. Although McDavid initially indicated to the court that it was considering stipulating to entry of a denial of its Motion for Preliminary Injunction based on the court's claim construction, McDavid ultimately decided to pursue its Motion for Preliminary Injunction, which this court has denied today in a separate opinion. McDavid's "Motion for Leave to File Second Amended Complaint" (Dkt. No. 159) to add previously unalleged copyright and trademark infringement claims and to supplement its existing unfair competition claims is currently before the court. For the reasons explained below, McDavid's motion is denied.

BACKGROUND

When McDavid on November 17, 2008 filed its initial one-count complaint against Nike in this case, McDavid alleged that Nike was importing a product line of foam padded shorts manufactured in Taiwan by a process that infringed U.S. Patent No. 6,743,325 ("'325 Patent"). On June 3, 2009, District Judge Suzanne B. Conlon, who was the then presiding judge in this case, granted McDavid's motion to file a First Amended Complaint, which added McDavid's allegations of various unfair competition claims based on Nike's allegedly false statements to certain colleges and universities. (Dkt. No. 74.) Specifically, McDavid alleged that Nike falsely told these colleges and universities that under their supply agreements with Nike, they could not purchase athletic foam padded compression girdles (which Nike sells as part of its "ProCombat" product line) from a manufacturer other than Nike. (1st Am. Compl., attached as Ex. 1 to Dkt. No. 56.)

Following, this court issued its September 17, 2009 claim construction opinion construing the disputed terms in the '325 Patent. After first considering stipulating to entry of a denial of its Motion for Preliminary Injunction which would allow McDavid to seek appellate review of the court's claim construction ruling, McDavid instead decided to continue to pursue its Motion for Preliminary Injunction based on what McDavid claimed was a new patent infringement theory. The court has denied McDavid's Motion for Preliminary Injunction today in a separate opinion.

Currently before this court is McDavid's "Motion for Leave to File Second Amended Complaint" (Dkt. No. 159) to add copyright and trademark infringement claims and supplement its unfair competition claims. The proposed amendments and supplementation relate to Nike's advertising campaign for its "ProCombat" line which began on or around September 2009. (See Ex. D to 2d Am. Compl., attached as Ex. 1 to Dkt. No. 167, Pls.' Reply.) As stated above, for the reasons explained below, McDavid's motion is denied.

ANALYSIS

I. McDavid's Motion to File a Second Amended Complaint

Under Federal Rule of Civil Procedure 15(a), after the period for amending as a matter of course has expired, "a party may amend its pleading only with the opposing party's written consent or the court's leave." Fed. R. Civ. P. 15(a). The Federal Circuit applies the law of the regional circuit, here the Seventh Circuit, to motions to amend the pleadings under Rule 15(a). Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312, 1318 (Fed. Cir. 2009).

In the Seventh Circuit, the district court may deny a motion to amend "if the moving party has unduly delayed in filing the motion, if the opposing party would suffer undue prejudice, or if the pleading is futile." Campania Mgmt. Co. v. Rooks, Pitts & Poust, 290 F.3d 843, 848-49 (7thCir. 2002). "[T]he grant or denial of an opportunity to amend is within the discretion of the District Court...." Foman v. Davis, 371 U.S. 178, 182 (1962).

In this case, the court finds that McDavid's proposed amendments are futile and likely to unduly prejudice Nike. McDavid's requested amendment, therefore, will not be allowed.

A. Futility

Nike argues that both McDavid's trademark and copyright infringement claims are futile, and the court agrees. According to the Seventh Circuit, "[a] new claim is futile if it would not withstand a motion to dismiss." Vargas-Harrison v. Racine Unified Sch. Dist., 272 F.3d 964, 974 (7th Cir. 2001). Additionally, because a motion to amend the complaint is "addressed to the discretion of the district court," the motion "requires more to compel acceptance than the ...


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