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Pressure Specialist, Inc. v. Next Gen Manufacturing Inc.

United States District Court, N.D. Illinois, Eastern Division

January 24, 2018

PRESSURE SPECIALIST, INC., Plaintiff,
v.
NEXT GEN MANUFACTURING, INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          AMY J. ST. EVE United States District Court Judge.

         On September 12, 2017, Plaintiff Pressure Specialist, Inc. (“PSI”) brought the present Complaint against Defendant Next Gen Manufacturing (“Next Gen”) alleging patent infringement. Before the Court is Next Gen's motion to dismiss Count I brought pursuant to Federal Rule of Civil Procedure 12(b)(6). For the following reasons, the Court denies Defendant's motion to dismiss.

         BACKGROUND

         In this Complaint, Plaintiff asserts a patent infringement claim alleging that Defendant has infringed on Plaintiff's United State Patent No. 6, 851, 447, entitled “Direct Acting Gas Regulator” (hereinafter the “'447 Patent”), and United State Patent No. 7, 059, 343 (hereinafter the “'343 Patent”).[1] (R. 1, Compl.) Plaintiff is an Illinois corporation with its principal place of business in Crystal Lake, Illinois, and it is in the business of designing, developing, manufacturing, and selling hoses, fittings, regulators, fill stations, and accessories for paintball, air-gun, and related industries. (Id. ¶¶ 1, 5.) Plaintiff has designed and holds 12 patents covering paintball products. (Id. ¶ 5.) Defendant is an Illinois corporation with its principal place of business in Elgin, Illinois. (Id. ¶ 2.)

         Plaintiff alleges that Defendant infringed on Plaintiff s patent by manufacturing and selling a paintball regulator called the PowerHouse Competition Regulator (the “Regulator”). (Id. ¶ 6.) A paintball regulator is a device that regulates the pressure of the air entering a paintball gun by cutting off the air source when the pressure in the regulator chamber reaches a certain pressure. (Id. ¶ 7.) ASTM is an international standards organization that publishes technical standards for a wide range of materials and products, and Plaintiffs regulators are ASTM-compliant. (Id.) Plaintiff alleges that Jeff Schreiber, Plaintiffs former employee, who worked on Plaintiffs research and development teams and had access to confidential information regarding Plaintiffs products, began working with Defendant to promote and sell the Regulator at issue after Plaintiff terminated him. (Id. ¶¶ 8-9.) Plaintiff brought a pending state court lawsuit against Schreiber for breach of non-competition and confidentiality agreements. (Id. ¶ 9.)

         In Count I, Plaintiff alleges that it is the owner of all rights, titles, and interests in the ‘447 Patent, a valid, enforceable patent, including the right to exclude others and to enforce, sue, and recover damages for past and future infringement. (Id. ¶¶ 12-13.) Plaintiff alleges that Defendant directly infringed and continues to infringe on the ‘447 Patent through its production and sale of the Regulator. (Id. ¶ 14.) Claim 1 of the ‘447 Patent recites: a direct acting pressure regulator comprised of the following: (1) a body with a high pressure inlet and defining a seat, with a guide sleeve therein; (2) an bonnet with a regulated gas outlet and a body guide sleeve extending into the piston chamber; (3) a piston disposed within the piston chamber and in the guide sleeve that is movable between open and closed regulator conditions and that has a sealing element formed of resilient materials; (4) a spring disposed in the piston chamber for urging the piston to the open regulator condition; (5) a first seal disposed between the sealing element and the piston chamber at about the guide sleeve; (6) a second seal disposed between the impingement surface and the piston chamber; and (7) a pin valve disposed in the central longitudinal bore of the piston. (Id. ¶ 15.)

         Plaintiff alleges that the Regulator, Defendant's product, has a body with a high pressure inlet and a guide sleeve. (Id. ¶¶ 16-18.) It also has a bonnet with a low pressure side outlet that is threaded onto the body to define a piston chamber. (Id. ¶¶ 19-20.) The Regulator also has a piston disposed within the piston chamber and in part in the guide sleeve. (Id. ¶ 21.) Plaintiff alleges that the bonnet of the Regulator has a stop surface that stops movement out of the piston. (Id. ¶ 22.) The Regulator includes a gap between the piston and the piston chamber wall and the piston moves between open position and closed position. (Id. ¶¶ 23-24.) Plaintiff alleges that the Regulator's piston includes a support in which the resilient ball is positioned and this support has openings that open into a bore in the piston. (Id. ¶¶ 25-26.) The piston also includes a shoulder that engages the bonnet stop surface. (Id. ¶ 27.) A spring is positioned on the piston within the chamber that urges the resilient ball of the seat. (Id. ¶ 28.) The Regulator also has an O-ring seal on the piston and a pin valve on the piston bore. (Id. ¶¶ 29-30.) Plaintiff alleges that the Regulator infringes on Patent 447 causing damages to Plaintiff. (Id. ¶¶ 31-35.)

         In Count II, Plaintiff alleges that it is the owner of all right, title, and interest in the ‘343 Patent, a valid, enforceable patent, including the right to exclude others and to enforce, sue, and recover damages for past and future infringement. (Id. ¶¶ 38-39.) Plaintiff alleges that Defendant directly infringed and continues to infringe on the ‘343 Patent through its production and sale of the Regulator. (Id. ¶ 40.) Claim 1 of the ‘343 Patent recites: a direct acting pressure regulator comprised of the following: (1) a body with a high pressure inlet and defining a seat; (2) a bonnet that engages with the body to define a piston chamber within the body and the bonnet and with a regulated gas outlet; (3) a piston disposed within the piston chamber and defining a gap between the piston and the wall defining the chamber and capable of moving between open and closed regulator conditions and that has a plug with a sealing element that engages with the seat; (4) a spring for urging the piston to the open regulator condition; and (5) a pin valve disposed in the central longitudinal bore of the piston. (Id. ¶ 41.) The Regulator piston has a plug in which a sealing element is positioned with radial opening that open into a bore in the piston. (Id. ¶¶ 42-43.) Plaintiff alleges that the Regulator infringes on the ‘343 Patent causing damages to Plaintiff. (Id. ¶¶ 44-47.)

         LEGAL STANDARD

         Even in patent cases, the Court looks to Seventh Circuit law for the standard governing motions to dismiss under Rule 12(b)(6). See Lyda v. CBS Corp., 838 F.3d 1331, 1337 (Fed. Cir. 2016); see also Alfred E. Mann Found. for Sci. Res. v. Cochlear Corp., 841 F.3d 1334, 1346 (Fed. Cir. 2016). “A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) challenges the viability of a complaint by arguing that it fails to state a claim upon which relief may be granted.” Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732, 736 (7th Cir. 2014). Under Rule 8(a)(2), a complaint must include “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). The short and plain statement under Rule 8(a)(2) must “give the defendant fair notice of what the claim is and the grounds upon which it rests.” Bell Atlantic v. Twombly, 550 U.S. 544, 555 (2007) (citation omitted). Under the federal notice pleading standards, a plaintiff's “factual allegations must be enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. Put differently, a “complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570).

         In determining the sufficiency of a complaint under the plausibility standard, courts must “accept all well-pleaded facts as true and draw reasonable inferences in the plaintiffs' favor.” Roberts v. City of Chicago, 817 F.3d 561, 564 (7th Cir. 2016). Some of the facts the Court references come from exhibits attached to the complaint. The Court may properly consider such attachments in ruling on a Rule 12(b)(6) motion to dismiss. See Phillips v. Prudential Ins. Co. of Am., 714 F.3d 1017, 1019-20 (7th Cir. 2013); McWorthey v. Tech. Ins. Co., No. 15-cv-5021, 2016 WL 4398063, at *3 n.3 (N.D. Ill. Aug. 18, 2016). When the exhibits contradict the allegations, “the exhibits trump the allegations.” See Abcarian v. McDonald, 617 F.3d 931, 933 (7th Cir. 2010); McWorthey, 2016 WL 4398063, at *3 n.3.

         ANALYSIS

         U.S. Code Title 35, Section 271(a) governs direct patent infringement and provides that “whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States . . . during the term of the patent therefor, infringes the patent.” 35 U.S.C. § 271(a). “To prove infringement, the patentee must show that an accused product embodies all limitations of the claim [that the patentee alleges the defendant infringed] either literally or by the doctrine of equivalents.” Cephalon, Inc. v. Watson Pharm., Inc., 707 F.3d 1330, 1340 (Fed. Cir. 2013); see also Profectus Tech. LLC v. Huawei Techs. Co., 823 F.3d 1375, 1382 (Fed. Cir. 2016) (“The infringement inquiry asks if an accused device contains every claim limitation or its equivalent.”). “To establish literal infringement, every limitation set forth in a claim must be found in an accused product, exactly.” Advanced Steel Recovery, LLC v. X-Body Equip., Inc., 808 F.3d 1313, 1319 (Fed. Cir. 2015) (quoting Southwall Techs., Inc. v. Cardinal IG Co., 54 F.3d 1570, 1575 (Fed. Cir. 1995)).

         Courts applying the Twombly-Iqbal standard to patent infringement claims have required plaintiffs to set forth sufficient facts to plausibly allege that the accused product embodies every limitation in a particular asserted claim. See, e.g., Scripps Res. Inst. v. Illumina, Inc., No. 16-cv-661 JLS (BGS), 2016 WL 6834024, at *4 (S.D. Cal. Nov. 21, 2016); Atlas IP, LLC v. Exelon Corp., 189 F.Supp.3d 768, 775 (N.D. Ill. 2016). This requirement flows naturally from the Twombly/Iqbal standard and the burden of proof in a patent infringement case “because ‘the failure to meet a single limitation is sufficient to negate infringement of [a] claim.'” e.Digital Corp. v. iBaby ...


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