IN RE: CHROMACODE LITIGATION ( 2024 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 SAN JOSE DIVISION 7 8 CHROMACODE, INC., et al., Case No. 23-cv-04823-EKL (VKD) 9 Plaintiffs, ORDER GRANTING 10 v. CHROMACODE’S MOTION FOR LEAVE TO AMEND INVALIDITY 11 BIO-RAD LABORATORIES, INC., CONTENTIONS 12 Defendant. Re: Dkt. No. 68 13 14 In connection with its invalidity defenses against patents asserted by defendant and 15 counter-plaintiff Bio-Rad Laboratories, Inc. (“Bio-Rad”), plaintiff and counter-defendant 16 ChromaCode, Inc. (“ChromaCode”) seeks leave to amend its invalidity contentions to add 17 contentions identifying three claim terms as indefinite. Dkt. No. 68; see Dkt. No. 40 at 6. Bio- 18 Rad opposes the motion. Dkt. No. 74. The Court held a hearing on the motion on September 17, 19 2024. Dkt. No. 81. For the reasons explained below, the Court grants ChromaCode’s motion for 20 leave to amend. 21 I. BACKGROUND 22 In its counterclaim in this patent infringement action, Bio-Rad asserts infringement of two 23 patents, U.S. Patent No. 9,222,128 (“the ’128 patent”) and U.S. Patent No. 9,921,154 (“the ’154 24 patent”). Dkt. No. 27 at 9-15. Pursuant to Patent Local Rule 3-3, ChromaCode served 25 preliminary invalidity contentions regarding Bio-Rad’s asserted patents on February 5, 2024, and 26 then (apparently, by agreement of the parties) revised invalidity contentions on February 29, 2024. 27 See Dkt. No. 68-1 ¶¶ 3-6; Dkt. No. 74-2; Dkt. No. 74-3. ChromaCode’s February 29, 2024 1 invalid for indefiniteness under 35 U.S.C. § 112, in addition to other invalidity contentions. See 2 Dkt. No. 74-3 at 10-12. 3 On March 7, 2024, pursuant to Patent Local Rule 4-1, ChromaCode identified several 4 terms requiring claim construction, including the following: 5 • “determining a total number of amplification-positive partitions for each type of the more than R targets” (’128 patent) 6 7 • “generally parallel” (’154 patent) 8 • “a different plurality of the partitions contains each different pair of the R targets” (’154 patent) 9 10 Dkt. No. 68-1 ¶ 7. On March 19, 2024, pursuant to Patent Local Rule 4-2, ChromaCode served its 11 preliminary claim constructions, identifying these three terms as “indefinite.” Id. ¶ 8. 12 ChromaCode did not include indefiniteness contentions as to these three terms in its February 5, 13 2024 or February 29, 2024 invalidity contentions. Dkt. No. 68 at 1. 14 On April 5, 2024, the parties filed their joint claim construction statement pursuant to 15 Patent Local Rule 4-3. Dkt. No. 51. That statement included each of the three terms listed above 16 as well as the parties’ respective claim construction positions for each term.1 See id. at 8-10. The 17 statement indicated that neither party expected to call witnesses at the claim construction hearing, 18 and that neither party requested any factual findings by the presiding judge. See id. at 10. 19 Between May 20, 2024 and June 18, 2024, the parties briefed the construction of the claim 20 terms in dispute, including the three terms listed above. See Dkt. Nos. 54, 59, 64. In its opening 21 claim construction brief, Bio-Rad objected that ChromaCode had failed to include its 22 indefiniteness contentions as to the three terms in ChromaCode’s earlier invalidity contentions, but 23 Bio-Rad also argued against finding the terms indefinite on the merits. Dkt. No. 54 at 10-13, 17- 24 22. On June 5, 2024, ChromaCode asked Bio-Rad to stipulate that ChromaCode be permitted to 25 amend its invalidity contentions to include indefiniteness contentions for the three terms. Dkt. No. 26 68-1 ¶ 11. Bio-Rad declined to so stipulate. Id. ChromaCode briefed the merits of its 27 1 indefiniteness positions in its responsive claim construction brief. Dkt. No. 59 at 19-22, 23-25. 2 Bio-Rad again addressed the merits of ChromaCode’s indefiniteness positions in Bio-Rad’s reply 3 claim construction brief. Dkt. No. 64 at 7-9, 11-13. A claim construction hearing is set for 4 December 12, 2024 before the presiding judge. Dkt. No. 88. 5 II. LEGAL STANDARD 6 The Patent Local Rules seek to “balance the right to develop new information in discovery 7 with the need for certainty as to the legal theories.” O2 Micro Int'l Ltd. v. Monolithic Power Sys., 8 Inc., 467 F.3d 1355, 1366 (Fed. Cir. 2006). Invalidity contentions therefore may be amended 9 “only by order of the Court upon a timely showing of good cause.” Patent L.R. 3-6. 10 In assessing whether good cause exists, the Court considers whether the moving party was 11 diligent in seeking to amend its contentions, and whether the non-moving party would suffer 12 prejudice if the amendment were permitted. See Barco N.V. v. Tech. Properties Ltd., No. 5:08-cv- 13 05398 JF HRL, 2011 WL 3957390, at *1 (N.D. Cal. Sept. 7, 2011). To established diligence, a 14 party generally must show both diligence in discovering the basis for amendment and diligence in 15 seeking amendment once the basis for amendment has been discovered. Positive Techs., Inc. v. 16 Sony Elecs., Inc., No. 11-cv-2226 SI, 2013 WL 322556, at *2 (N.D. Cal. Jan. 28, 2013). “If the 17 court determines that the moving party was not diligent, the inquiry may end there.” Twilio, Inc. 18 v. Telesign Corp., No. 16-cv-06925-LHK (SVK), 2017 WL 3581186, at *2 (N.D. Cal. Aug. 18, 19 2017) (citation omitted). “However, the court retains discretion to grant leave to amend in the 20 absence of diligence where there is no prejudice to the opposing party.” Id. (citations omitted); 21 see also Karl Storz Endoscopy-Am., Inc. v. Stryker Corp., No. 14-cv-00876-RS (JSC), 2016 WL 22 2855260, at *7 (N.D. Cal. May 13, 2016) (collecting cases). 23 III. DISCUSSION 24 The Court first considers whether ChromaCode was diligent in seeking to amend its 25 invalidity contentions, and then considers whether Bio-Rad would suffer prejudice if amendment 26 is permitted. 27 A. Diligence 1 its invalidity contentions, including “[a]ny grounds of invalidity based on . . . indefiniteness under 2 35 U.S.C. § 112(2)” for any asserted claim. Patent L.R. 3-3(d). There is no dispute that 3 ChromaCode should have disclosed its contention that the three claim terms at issue are indefinite 4 in its February 29, 2024 invalidity contentions, if not before. Dkt. No. 68 at 1. However, the 5 parties appear to disagree regarding what information Patent Local Rule 3-3(d) requires a party to 6 disclose about its indefiniteness positions. Bio-Rad seems to suggest that a party must provide 7 “some sort of explanation” about why it believes a claim term is indefinite. See Dkt. No. 74 at 9; 8 see also id. at 2, 5. ChromaCode seems to suggest that a party need only disclose the specific 9 terms it contends are indefinite. See Dkt. No. 68 at 7; Dkt. No. 76 at 5 n.1. No party cites any 10 relevant authority regarding what kind of disclosure is sufficient to satisfy Patent Local Rule 3- 11 3(d) for indefiniteness. The Court notes that other judges in this District have found that a party’s 12 disclosure of the specific claim term that renders an asserted claim indefinite satisfies the Rule. 13 See, e.g., Karl Storz Endoscopy-Am., Inc. v. Stryker Corp., No. 14-cv-00876-RS (JSC), 2017 WL 14 5257001, at *3, *5 (N.D. Cal. Nov. 13, 2017); cf. NobelBiz, Inc. v. LiveVox, Inc., No. 13-cv-1773- 15 YGR, 2015 WL 225223, at *8 (N.D. Cal. Jan. 16, 2015) (finding contentions insufficient where 16 “defendants did not identify the term ‘geographic region’ as the source of indefiniteness, but rather 17 included the entirety of a lengthier phrase”); Rambus Inc. v. NVIDIA Corp., No. 08-cv-03343 SI, 18 2011 WL 13249391, at *9 (N.D. Cal. Nov. 29, 2011) (finding contentions insufficient where party 19 relied on qualified language, and did not “specifically identify the precise limitations alleged to be 20 indefinite”).2 21 Bio-Rad does not dispute that ChromaCode disclosed to Bio-Rad its position that the three 22 terms at issue were indefinite on March 19, 2024—19 days after ChromaCode served its revised 23 invalidity contentions. Dkt. No. 68 at 7; Dkt. No. 74 at 2. While ChromaCode disclosed this 24 position as part of its Patent Local Rule 4-2 claim construction disclosure, and not in its Patent 25 Local Rule 3-3 invalidity contentions, the content of the disclosure was no different than what 26 27 2 As ChromaCode observes, Bio-Rad’s own invalidity contentions in related case No. 23-cv-6360- 1 would have been necessary to satisfy the requirements of Patent Local Rule 3-3(d) for 2 indefiniteness. ChromaCode acknowledges that it made a mistake in not including its 3 indefiniteness position on these three terms in its invalidity contentions but explains that “as it 4 analyzed the potential constructions for these terms, [it] concluded that they were indefinite.” Dkt. 5 No. 76 at 5. The Court finds that ChromaCode was diligent in discovering the basis for its 6 indefiniteness position as to the three terms at issue and promptly disclosed its indefiniteness 7 position to Bio-Rad thereafter. 8 ChromaCode was not so prompt in seeking leave to amend its invalidity contentions. The 9 parties agree that Bio-Rad first objected to ChromaCode’s indefiniteness arguments on May 20, 10 2024 when Bio-Rad filed its opening claim construction brief. Dkt. No. 68 at 4; Dkt. No. 74 at 2. 11 ChromaCode sought Bio-Rad’s consent to amend its invalidity contentions to address this 12 objection on June 5, 2024, which was refused on June 12, 2024. Dkt. No. 68-1 ¶ 11. Whether this 13 refusal was reasonable or not is irrelevant to whether ChromaCode diligently sought leave to 14 amend. ChromaCode’s explanations for why it waited until August 8, 2024 to seek leave—i.e. 15 limited resources, briefing claim construction, participating in a settlement conference (see Dkt. 16 No. 76 at 2)—are not particularly compelling. See Dkt. No. 76 at 2. In short, the Court finds that 17 ChromaCode was not diligent in seeking leave to amend. 18 Critical to resolution of this motion is the Court’s finding that ChromaCode fully disclosed 19 its indefiniteness position regarding the three terms to Bio-Rad shortly after ChromaCode served 20 its invalidity contentions. Thus, while ChromaCode was not diligent in seeking leave to amend its 21 invalidity contentions to conform them to the indefiniteness arguments disclosed during the 22 parties’ preparations for claim construction, the Court finds that ChromaCode was diligent in 23 discovering the basis for contending these terms are indefinite and in formally disclosing its 24 indefiniteness position to Bio-Rad. To find that ChromaCode was not diligent in these 25 circumstances and should therefore be prevented from amending its contentions would be to 26 elevate form over substance. The Court declines to find lack of diligence here. See, e.g., 27 Facebook, Inc. v. BlackBerry Ltd., No. 18-cv-05434-JSW (JSC), 2020 WL 864934, at *10 (N.D. 1 9422395 (N.D. Cal. Mar. 30, 2020) (finding no lack of diligence where, among other things, 2 opposing party had notice of proposed amendments for over one month prior to claim construction 3 hearing); 24/7 Customer, Inc. v. Liveperson, Inc., No. 15-cv-02897 JST (KAW), 2016 WL 4 6673983, at *3 (N.D. Cal. Nov. 14, 2016) (finding no lack of diligence where defendant “informed 5 [plaintiff] of its new § 112 position one month after it served the initial invalidity contentions, and 6 sought to meet and confer regarding the supplemental contentions a little more than one month 7 later . . . prior to the close of claim construction discovery”); see also The Bd. of Trustees of 8 Leland Stanford Junior Univ. v. Roche Molecular Sys., Inc., No. 05-cv-04158 MHP, 2008 WL 9 624771, at *3 (N.D. Cal. Mar. 4, 2008) (finding that while plaintiff was “arguably not diligent in 10 pursuing the amendment with this court, it was diligent in notifying and seeking discovery from 11 [defendant]” with respect to infringement contentions). 12 Illumina Inc. v. BGI Genomics Co., No. 20-cv-01465-WHO, 2020 WL 6891818 (N.D. Cal. 13 Nov. 24, 2020) could be read as supporting a different conclusion on the question of diligence. 14 Addressing the parties’ claim construction arguments, not a motion for leave to amend, the court 15 in that case found that defendant had “waived the right to assert [an] indefiniteness challenge” 16 because it had not disclosed its indefiniteness arguments in its invalidity contentions, but only 17 during preparations for claim construction. Illumina, 2020 WL 6891818, at *8. However, in 18 reaching this conclusion, the court observed: 19 [T]he Patent Local Rules lay out a particular process and standard for amending contentions that [defendant] has not followed, 20 allowing a party to amend invalidity contentions “by order of the 21 Court upon a timely showing of good cause.”. . . . [Defendant] has not attempted to amend its invalidity contentions or to make out a 22 showing of “good cause” to do so. It offers no explanation as to why it did not include this challenge in its initial invalidity 23 contentions and has not sought leave of court to make any such amendment, undermining a potential argument that it has diligently 24 sought to amend. 25 26 Id. Thus, the court in Illumina was not asked to decide whether leave to amend should be given, 27 as ChromaCode asks here, but instead considered whether it should find a waiver on the merits in 1 the defendant in Illumina, in so far as ChromaCode now seeks leave to amend its invalidity 2 contentions to conform to its claim construction disclosures. 3 B. Prejudice 4 ChromaCode argues that permitting amendment will not prejudice Bio-Rad. ChromaCode 5 observes that Bio-Rad had notice of ChromaCode’s indefiniteness position with respect to the 6 three claim terms at issue two months before the parties began claim construction briefing. It 7 argues that Bio-Rad could have taken discovery or otherwise sought further information regarding 8 ChromaCode’s indefiniteness position before filing its opening claim construction brief, but that 9 Bio-Rad elected not to do so. ChromaCode argues that, in any event, Bio-Rad had ample 10 opportunity to brief, and did brief, indefiniteness on the merits. Dkt. No. 68 at 3-4, 6-7. 11 Bio-Rad does not dispute that it neither objected to, nor sought information about, 12 ChromaCode’s indefiniteness position for the three claim terms before Bio-Rad filed its opening 13 claim construction brief. Nevertheless, Bio-Rad argues that it suffered prejudice because it “was 14 forced to blindly address unexplained invalidity contentions in its opening claim construction 15 brief”—i.e. ChromaCode’s position that the three terms are indefinite—and “then only had one 16 opportunity to address ChromaCode’s positions[] in its reply claim construction brief . . .” Dkt. 17 No. 74 at 9. 18 Bio-Rad’s prejudice arguments are unpersuasive. If, as the Court finds above, 19 ChromaCode’s Patent Local Rule 4-2 claim construction disclosure included the same information 20 about its indefiniteness position that Patent Local Rule 3-3(d) requires—i.e. identification of the 21 specific terms a party contends are indefinite—it is simply not plausible that Bio-Rad suffered 22 prejudice in briefing claim construction solely because it got that information 19 days late. If Bio- 23 Rad was “blind” to the specific arguments ChromaCode intended to advance in support of its 24 indefiniteness position, Bio-Rad bears at least some of the blame for its predicament because it 25 failed to inquire or to adequately confer with ChromaCode about construction of the three terms, 26 as the Patent Local Rules require. See Patent L.R. 4-2(c) (After exchanging preliminary claim 27 constructions, “[t]he parties shall . . . meet and confer for the purposes of narrowing the issues and 1 Importantly, ChromaCode’s indefiniteness arguments as to the three terms at issue do not 2 rely on expert testimony or any other extrinsic evidence. And Bio-Rad does not contend that it 3 requires expert testimony or any discovery to oppose ChromaCode’s arguments. Instead, the 4 parties rely solely on legal argument and intrinsic evidence for their respective positions as to 5 these three terms. See Dkt. Nos. 54, 59, 64. Thus, this is not the kind of case where Bio-Rad was 6 prevented by a late disclosure from developing evidence necessary to respond to ChromaCode’s 7 indefiniteness arguments. The Court does not suggest that disclosure of an indefiniteness position 8 as part of the exchanges required by Patent Local Rules 4-1 and 4-2 always eliminates any 9 prejudice to the patentee where an accused infringer has failed to timely disclose an indefiniteness 10 position in its invalidity contentions. Rather, in the circumstances presented here, the Court finds 11 that Bio-Rad did not suffer prejudice in briefing claim construction or otherwise. 12 With respect to Bio-Rad’s remaining argument that it was constrained by page limitations 13 from fully addressing ChromaCode’s indefiniteness arguments on the merits in its reply claim 14 construction brief, Bio-Rad could have sought relief from the presiding judge on that point but did 15 not. Bio-Rad does not explain what arguments it would have briefed during claim construction 16 had it had more pages to do so. Accordingly, the Court finds this argument unpersuasive. 17 Thus, the Court concludes that, even if ChromaCode was not diligent in seeking leave to 18 amend, it was diligent in promptly discovering and formally disclosing its indefiniteness position 19 to Bio-Rad, and Bio-Rad was not prejudiced by the timing of ChromaCode’s disclosure. The 20 Court exercises its discretion to permit the amendment. See Twilio, 2017 WL 3581186, at *2; 21 Karl Storz Endoscopy-Am., 2016 WL 2855260, at *7. 22 IV. CONCLUSION 23 The Court grants ChromaCode’s motion for leave to amend its invalidity contentions to 24 add contentions identifying the three claim terms listed above as indefinite. ChromaCode shall 25 serve its amended invalidity contentions on Bio-Rad by November 15, 2024. 26 // 27 // 1 IT IS SO ORDERED. 2 Dated: November 8, 2024 3 Virginia K. DeMarchi 5 United States Magistrate Judge 6 7 8 9 10 11 12 13 15 16 = 17 Z 18 19 20 21 22 23 24 25 26 27 28