United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION & ORDER
Honorable Thomas M. Durkin United States District Judge
EZ STAK, LLC has sued defendant Dejana Truck & Utility
Equipment Company, LLC in a declaratory judgment action to
decide the validity of Dejana's asserted patents relating
to shelving systems installed in vans and trucks. Currently
before the Court is EZ STAK's motion to dismiss
Dejana's counterclaims pursuant to Fed.R.Civ.P. 12(b)(6)
(R. 29). For the reasons explained below, the Court denies EZ
pleading standards set forth in Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007), and Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) apply to patent
infringement claims. Atlas IP, LLC v. Exelon Corp.,
189 F.Supp.3d 768, 771 (N.D. Ill. 2016). Pursuant to these
standards, a claim or counterclaim must provide “a
short plain statement of the claim showing that the pleader
is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Through
this statement, the opposing party must be given “fair
notice” of the claim and the basis for it.
Twombly, 550 U.S. at 555. This means the claim or
counterclaim must “contain sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Iqbal, 556 U.S.
at 678 (quoting Twombly, 550 U.S. at 570).
“‘A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.'” Mann, 707
F.3d at 877 (quoting Iqbal, 556 U.S. at 678). In
applying this standard, the Court accepts all well-pleaded
facts as true and draws all reasonable inferences in favor of
the non-moving party. Mann, 707 F.3d at 877.
following facts are taken from Dejana's counterclaims.
Dejana is a manufacturer and supplier of storage solutions
for trucks and vans. R. 24 ¶ 7. Dejana owns U.S. Patent
Nos. 8, 763, 820, 9, 010, 830, 9, 233, 647, 9, 381, 872, 9,
669, 773, and 9, 796, 339. Id. ¶ 1. All of
these patents are for various aspects of Dejana's
interior vehicle shelving systems, including Dejana products
known as Katerack and DuraRac. Id. ¶¶ 7-9.
Two of the patents are for shelving systems with cages to
store ladders inside a vehicle (id. ¶¶
12-22), two are for rack and tray devices for vehicle
shelving systems (id. ¶¶ 23-30), and two
are for locking mechanisms for vehicle shelving systems
(id. ¶¶ 31-40).
is a manufacturer of modular interior storage systems for
trucks and vans. Id. ¶ 41. EZ STAK distributes
products directly to customers and through third-party
affiliated dealers. Id. ¶ 43. EZ STAK
specializes in providing customized solutions, advertising
itself as working one-on-one with clients to meet their
storage needs. Id. ¶ 45.
alleges that EZ STAK has agreed to make Dejana's patented
shelving systems at a lower cost for multiple potential
customers. Id. ¶¶ 67-82, 87-95. In
particular, Dejana alleges that after it submitted proposed
designs for a DuraRac shelving system to Peoples Gas, a
utility provider, it learned that a copycat system would
instead be manufactured by EZ STAK “based on
Dejana's proposed drawings.” Id.
¶¶ 76-81. Dejana alleges that EZ STAK in fact
manufactured and sold that copycat system to Peoples Gas.
Id. ¶ 82.
sent EZ STAK a cease-and-desist letter on January 19, 2017.
Id. ¶ 74. In a response on January 24, 2017, EZ
STAK expressly represented that it would “not
manufacture the Katerack/DuraRac systems patented by
Dejana.” Id. ¶ 75. Nevertheless, at a
trade show in March 2017, EZ STAK allegedly displayed various
products that Dejana's representatives inspected and
confirmed included patented features from Dejana's
Katerack and DuraRac shelving systems. Id.
¶¶ 83-86. And during the summer of 2017, Dejana
learned that EZ STAK planned to supply a copycat shelving and
ladder rack system for Goodman Networks, a field services
company with whom Dejana had previously discussed supplying a
DuraRac shelving system. Id. ¶¶ 87-95.
December 5, 2017, EZ STAK sued Dejana in a declaratory
judgment action seeking adjudication of the validity of the
asserted patents. R. 1. On February 28, 2018, Dejana filed
patent infringement counterclaims spanning 567 paragraphs and
over 100 pages, with a separate count for each of its six
patents. R. 24 ¶¶ 1-567. Each of Dejana's six
counterclaims is highly detailed, with descriptions of the
relevant patent, descriptions and labeled drawings of the
allegedly infringing products and their infringing features,
and images of allegedly infringing products that used to be
on EZ STAK's website but were subsequently removed.
alleges patent infringement not simply based on EZ STAK's
making or selling products covered by the patents, but also
based on EZ STAK's offering to sell such products.
Id. ¶¶ 103, 183, 266, 343, 427, 489.
Dejana seeks an injunction prohibiting all further
infringement, including infringement by inducement and
contributory infringement. Id. at p. 164. Dejana
also seeks treble damages for willful infringement.
Id. On April 11, 2018, Dejana served initial
infringement contentions containing 12 claim charts and 20
appendices. R. 37-2; R. 37-3.
motion to dismiss, EZ STAK repeats the same basic refrain
with respect to each of Dejana's counterclaims: that
Dejana does “not compare the claims of the[ ] six
patents to actual EZ STAK accused van installations.”
E.g., R. 30 at 1. Instead, Dejana compares the
patent claims to Dejana's drawings of allegedly
infringing products and images that allegedly have been
removed from EZ STAK's website. EZ STAK maintains that
Dejana has not alleged an infringement theory that satisfies
the plausibility standard set forth in Twombly and
Court agrees with Dejana that there are three fundamental
problems with this argument. First, EZ STAK
misunderstands Dejana's burden at the pleading stage. As
the Federal Circuit recently explained when reversing an
order dismissing patent infringement claims under
Twombly and Iqbal, “[s]pecific facts
are not necessary”; the opposing party need only be
given “fair notice of what the [infringement] claim is
and the ground upon which it rests.” Disc Disease
Sols. Inc. v. VGH Sols., Inc., 888 F.3d 1256, 1260 (Fed.
Cir. 2018). In other words, a party alleging patent
infringement need not “‘prove its case at the
pleading stage.'” Lifetime Indus., Inc. v.
Trim-Lok, Inc., 869 F.3d 1372, 1379 (Fed. Cir. 2017)
(quoting In re Bill of Lading Transmission &
Processing Sys. Patent Litig., 681 F.3d 1323, 1342 (Fed.
Cir. 2012) (warning against requiring a “level of
factual specificity” in pleading patent infringement
that “would be dangerously close to requiring a
plaintiff to prove he is entitled to relief at the pleading
stage”)). The ...