Matthews International Corp. v. Biosafe Engineering, LLC

United States Court of Appeals
for the Federal Circuit
__________________________
MATTHEWS INTERNATIONAL CORPORATION,
Plaintiff-Appellant,
v.
BIOSAFE ENGINEERING, LLC AND DIGESTOR,
LLC,
Defendants-Appellees.
__________________________
2012-1044
__________________________
Appeal from the United States District Court for the
Western District of Pennsylvania in case no. 11-CV-0269,
Judge Nora Barry Fischer.
__________________________
Decided: September 25, 2012
__________________________
KEVIN P. ALLEN, Thorp, Reed & Armstrong, LLP, of
Pittsburgh, Pennsylvania, argued for plaintiff-appellant.
With him on the brief was DAVID W. ENGSTROM. Of
counsel on the brief was JOHN W. MCILVAINE, III, The
Webb Law Firm, Pittsburgh, Pennsylvania.
SPIRO BEREVESKOS, Woodard, Emhardt, Moriarty
McNett & Henry, LLP, of Indianapolis, Indiana, argued
for defendants-appellees.
__________________________
MATTHEWS INTL v. BIOSAFE 2
Before RADER, Chief Circuit Judge, MAYER and SCHALL,
Circuit Judges.
MAYER, Circuit Judge.
Matthews International Corporation (“Matthews”)
appeals from the final order of the United States District
Court for the Western District of Pennsylvania dismissing
its claims for declaratory and injunctive relief. See Mat-
thews Int’l Corp. v. Biosafe Eng’g, LLC, No. 11-CV–0269,
2011 WL 4498935 (W.D. Pa. Sept. 27, 2011) (“District
Court Decision”). Because we conclude that the district
court correctly determined that Matthews’ claims lacked
sufficient immediacy and reality to support the exercise of
declaratory judgment jurisdiction, we affirm.
I. BACKGROUND
Matthews is a leader in the “death care” industry. It
manufactures cremation equipment, caskets, and bronze
memorials and sells them to funeral homes. Matthews is
currently marketing a Bio Cremation™ product, which
uses an alkaline hydrolysis 1 process, rather than incin-
eration, to cremate human remains. According to Mat-
thews, the Bio Cremation™ equipment offers an
“environmentally friendly” alternative to traditional
flame-based cremation.
Resomation Ltd. (“Resomation”) is a Scottish company
that manufactures and licenses equipment that employs
an alkaline hydrolysis process to dispose of human re-
mains. Resomation has granted Matthews an exclusive
license to market and sell its alkaline hydrolysis equip-
ment in the United States.
1 The term “alkaline hydrolysis” generally refers to
a method of subjecting materials to sodium or potassium
hydroxide and heat, thereby allowing such materials to be
disposed of in a safer and more efficient manner.
3 MATTHEWS INTL v. BIOSAFE
In 2007, Biosafe Engineering, LLC and Digestor, LLC
(collectively “Biosafe”) were formed to operate the busi-
ness acquired from a bankrupt company, Waste Reduction
by Waste Reduction, Inc. (“WR2”), and to hold the patents
acquired from WR2. Biosafe ultimately acquired several
patents related to the application of alkaline hydrolysis to
the disposal of various types of waste, such as medical
waste, infectious agents, and hazardous materials. These
patents include five method patents, U.S. Patent Nos.
5,332,532, 6,437,211, 6,472,580, 7,183,453, and 7,829,755
(collectively the “Method Patents”), and one system pat-
ent, U.S. Patent No. 7,910,788 (the “System Patent”).
On February 28, 2011, Matthews filed suit against
Biosafe, seeking a declaratory judgment of non-
infringement, invalidity, and unenforceability of the
Method Patents. Matthews also asserted state-law claims
of trade libel, defamation, and tortious interference with
contractual relations. On March 22, 2011, the System
Patent issued. On May 13, 2011, Matthews filed an
amended complaint, which included a request that the
System Patent be declared invalid and unenforceable. At
the time it filed its amended complaint, Matthews had
sold three Bio Cremation™ units, but none of these units
had been installed in customers’ facilities.
In its amended complaint, Matthews alleged that Bio-
safe had “wrongly accused Matthews of patent infringe-
ment, and ha[d] made false accusations about Matthews
to [Matthews’] customers, potential customers, and em-
ployees.” Matthews asserted that during a December
2008 telephone conversation, Biosafe’s president, Bradley
Crain, told Steven Schaal, an official at Matthews’ crema-
tion division, “that [Matthews’] sale of Resomation/Bio
Cremation™ equipment would infringe [Biosafe’s] alleged
intellectual property rights.” Matthews’ attorney thereaf-
ter sent Biosafe a letter, dated December 31, 2008, re-
MATTHEWS INTL v. BIOSAFE 4
questing that Biosafe “detail [its] concerns in writing”
regarding possible patent infringement by Matthews’
cremation products.
Biosafe’s counsel responded by letter dated February
2, 2009. This letter raised possible false advertising and
copyright infringement claims, asserting that Matthews
was distributing sales literature marketing the Resoma-
tion alkaline hydrolysis equipment using a picture that
actually depicted one of Biosafe’s units instead of one of
the Resomation units. The letter further stated that
Biosafe could pursue “a variety of remedies for disputes
involving intellectual property rights,” including a claim
for patent infringement if it were “determined that a new
installation by Resomation [was] operated in a manner
covered by any of Biosafe’s patents.” Matthews responded
by stating that while Biosafe’s letter made “vague, gen-
eral references to certain patent claims and process
parameters, [its] allegations [were] so vague and incom-
plete” that Matthews was “at a loss to respond.”
Matthews’ amended complaint further alleged that
Biosafe had “launched a bad faith whispering campaign in
the funeral home marketplace, by making accusations
and veiled threats to potential customers that [Matthews’]
Bio Cremation™ equipment” infringed Biosafe’s patents.
Matthews asserted, moreover, that one of its customers,
Stewart Enterprises, Inc., told Matthews that it was
reluctant to buy the Bio Cremation™ equipment because
of the accusations made by Biosafe.
On May 27, 2011, Biosafe moved to dismiss all counts
of Matthews’ amended complaint for lack of declaratory
judgment jurisdiction and for failure to adequately plead
state-law claims. On September 27, 2011, the district
court granted Biosafe’s motion to dismiss. The court
concluded that Matthews had not made “meaningful
5 MATTHEWS INTL v. BIOSAFE
preparation” to conduct potentially infringing activity,
District Court Decision, 2011 WL 4498935, at *6 (citations
and internal quotation marks omitted), since the “pa-
rameters used in the operation of Matthews’ devices
[were] not settled” and those devices could “be operated
with parameters outside of the various ones specified” in
the Method Patents, id. at *8 (citations and internal
quotation marks omitted). Because the potentially in-
fringing features of the Bio Cremation™ system were
“fluid and indeterminate,” Matthews’ claim “lack[ed] the
necessary reality to satisfy the constitutional require-
ments for declaratory judgment jurisdiction.” Id. (cita-
tions and internal quotation marks omitted). Given that
it had no information regarding the operating parameters
of Matthews’ Bio Cremation™ equipment, the district
court declined to provide “an advisory opinion specifying
what combinations of parameters are infringing and what
combinations of parameters are noninfringing.” Id. at *9.
The court likewise dismissed, pursuant to Federal
Rule of Civil Procedure 12(b)(6), Matthews’ state-law
claims alleging trade libel, defamation, and tortious
interference with contractual relations. It noted that “bad
faith” was a required element of Matthews’ state-law
claims, but that Matthews had failed to adequately plead
the bad faith element. The court concluded that a finding
of bad faith could not be premised on the dissemination of
information that was “objectively accurate,” and that
Matthews’ “bald assertions” were insufficient to support
its claim that Biosafe’s infringement allegations were
made in bad faith. District Court Decision, 2011 WL
4498935, at *11-12 (citations and internal quotation
marks omitted).
Matthews then filed a timely appeal with this court.
We have jurisdiction under 28 U.S.C. § 1295(a)(1).
MATTHEWS INTL v. BIOSAFE 6
II. DISCUSSION
A. Standard of Review
“Whether an actual controversy exists under the De-
claratory Judgment Act, 28 U.S.C. § 2201(a), is a question
of law that is subject to plenary appellate review.” Cat
Tech LLC v. TubeMaster, Inc., 528 F.3d 871, 878 (Fed.
Cir. 2008). Review of the dismissal of Matthews’ state-
law claims for failure to state a claim upon which relief
could be granted is likewise subject to de novo appellate
review. Xechem Int’l, Inc. v. Univ. of Tex. M.D. Anderson
Cancer Ctr., 382 F.3d 1324, 1326 (Fed. Cir. 2004); Boyle v.
United States, 200 F.3d 1369, 1372 (Fed. Cir. 2000).
B. The Declaratory Judgment Act
The Declaratory Judgment Act does not provide an
independent basis of subject matter jurisdiction. 2 Skelly
Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 671-72
(1950). Instead, “[i]ts remedy may lie only if the court has
jurisdiction from some other source.” Cat Tech, 528 F.3d
at 879; see Aetna Life Ins. Co. v. Haworth, 300 U.S. 227,
240 (1937). The party seeking to establish declaratory
judgment jurisdiction bears the burden of demonstrating
that an Article III case or controversy exists at the time
2 In relevant part, the Declaratory Judgment Act
provides:
In a case of actual controversy within its ju-
risdiction . . . any court of the United
States, upon the filing of an appropriate
pleading, may declare the rights and other
legal relations of any interested party seek-
ing such declaration, whether or not further
relief is or could be sought.
28 U.S.C. § 2201(a).
7 MATTHEWS INTL v. BIOSAFE
the claim for declaratory relief is filed. 3 Arris Grp., Inc. v.
British Telecomms., PLC, 639 F.3d 1368, 1373 (Fed. Cir.
2011).
Because Article III of the Constitution restricts the
judicial power to the adjudication of “Cases” or “Contro-
versies,” U.S. Const. Art. III, § 2, a court may not adjudi-
cate “a difference or dispute of a hypothetical or abstract
character” or “one that is academic or moot.” Aetna, 300
U.S. at 240. Instead, a justiciable controversy exists only
where a dispute is “definite and concrete, touching the
legal relations of parties having adverse legal interests,”
and will “admi[t] of specific relief through a decree of a
conclusive character, as distinguished from an opinion
advising what the law would be upon a hypothetical state
of facts.” Id. at 240-41; see MedImmune, 549 U.S. at 127.
“There is . . . no facile, all-purpose standard to police
the line between declaratory judgment actions which
satisfy the case or controversy requirement and those that
do not.” Cat Tech, 528 F.3d at 879. Accordingly, in de-
termining whether a justiciable controversy is present,
the analysis must be calibrated to the particular facts of
each case, with the fundamental inquiry being “whether
the facts alleged, under all the circumstances, show that
there is a substantial controversy, between parties having
adverse legal interests, of sufficient immediacy and
3 “Since its inception, the Declaratory Judgment
Act has been understood to confer on federal courts
unique and substantial discretion in deciding whether to
declare the rights of litigants.” Wilton v. Seven Falls Co.,
515 U.S. 277, 286 (1995). Accordingly, even if a case or
controversy exists, the trial court has significant discre-
tion in determining whether or not to exercise declaratory
judgment jurisdiction. See MedImmune, Inc. v. Genentech,
Inc., 549 U.S. 118, 136 (2007).
MATTHEWS INTL v. BIOSAFE 8
reality to warrant the issuance of a declaratory judg-
ment.” MedImmune, 549 U.S. at 127 (footnote omitted)
(citations and internal quotation marks omitted); see Cat
Tech, 528 F.3d at 879. Here, as the trial court correctly
concluded, Matthews’ dispute with Biosafe lacks the
requisite immediacy and reality to support the exercise of
declaratory judgment jurisdiction.
C. Immediacy
Matthews’ dispute with Biosafe lacks immediacy be-
cause there is no evidence as to when, if ever, the Bio
Cremation™ equipment will be used in a manner that
could potentially infringe the Method Patents. Matthews
has taken no steps toward direct infringement of those
patents. Although it sells the Bio Cremation™ equip-
ment, it does not practice any of the methods disclosed in
the Method Patents, and cannot, therefore, be held liable
for direct infringement. See Ricoh Co. v. Quanta Com-
puter Inc., 550 F.3d 1325, 1333 (Fed. Cir. 2008) (“In-
fringement of a method claim occurs when a party
performs all of the steps of the process . . . .” (citations and
internal quotation marks omitted)); Joy Techs., Inc. v.
Flakt, Inc., 6 F.3d 770, 773 (Fed. Cir. 1993) (“[A] method
or process claim is directly infringed only when the proc-
ess is performed.”).
Nor is any potential future infringement by Mat-
thews’ customers sufficiently immediate to support the
exercise of declaratory judgment jurisdiction. 4 As of May
4 “[W]here a patent holder accuses customers of di-
rect infringement based on the sale or use of a supplier’s
equipment, the supplier has standing to commence a
declaratory judgment action if (a) the supplier is obligated
to indemnify its customers from infringement liability, or
(b) there is a controversy between the patentee and the
supplier as to the supplier’s liability for induced or con-
tributory infringement based on the alleged acts of direct
9 MATTHEWS INTL v. BIOSAFE
13, 2011, the date it filed its amended complaint, Mat-
thews had sold three Bio Cremation™ units to customers.
None of these units, however, had been installed in cus-
tomers’ facilities. Significantly, the Bio Cremation™
equipment can be operated using parameters—related to
such items as temperature and pressure settings as well
as to pH levels—that do not infringe the Method Patents.
Given that Matthews has alleged no facts regarding
whether its customers plan to operate the Bio Crema-
tion™ equipment in a manner that could even arguably
infringe the Method Patents, its dispute with Biosafe is
too remote and speculative to support the exercise of
declaratory judgment jurisdiction.
“A party may not obtain a declaratory judgment
merely because it would like an advisory opinion on
whether it would be liable for patent infringement if it
were to initiate some merely contemplated activity.” Cat
Tech, 528 F.3d at 881 (citations and internal quotation
marks omitted); see also Public Serv. Comm’n v. Wycoff
Co., 344 U.S. 237, 244 (1952) (“The disagreement must
not be nebulous or contingent but must have taken on
fixed and final shape so that a court can see what legal
issues it is deciding, what effect its decision will have on
the adversaries, and some useful purpose to be achieved
in deciding them.”). Until some specific and concrete
evidence regarding how Matthews’ customers plan to use
the cremation units is available, any judicial determina-
tion regarding whether such use would infringe the
infringement by its customers.” Arris, 639 F.3d at 1375
(footnote omitted). Even assuming arguendo that Mat-
thews could be held liable for induced or contributory
infringement, however, its dispute with Biosafe is not ripe
for review given that, as will be discussed more fully
below, the parameters under which Matthews’ customers
plan to operate the Bio Cremation™ equipment are not
yet known.
MATTHEWS INTL v. BIOSAFE 10
Method Patents would be premature. See Sierra Applied
Scis., Inc. v. Advanced Energy Indus., Inc., 363 F.3d 1361,
1379 (Fed. Cir. 2004) (concluding that a dispute lacked
the required immediacy where a prototype of the product
in question would not be operational until more than a
year after the complaint was filed); Telectronics Pacing
Sys., Inc. v. Ventritex, Inc., 982 F.2d 1520, 1527 (Fed. Cir.
1992) (affirming the dismissal of a declaratory judgment
claim where clinical trials of an allegedly infringing
product had just begun and it was “years away” from
being approved by the Food and Drug Administration
(“FDA”)); Lang v. Pac. Marine & Supply Co., 895 F.2d
761, 764 (Fed. Cir. 1990) (concluding that the actual
controversy requirement was not satisfied where the
allegedly infringing product “would not be finished until
at least 9 months after the complaint was filed”).
As Matthews correctly notes, a showing of actual in-
fringement is not required for a case or controversy to
exist. See MedImmune, 549 U.S. at 134 (emphasizing
that a party need not “bet the farm, or . . . risk treble
damages . . . before seeking a declaration of its actively
contested legal rights”). On the other hand, however,
when it is unclear when any even arguably infringing
activity will occur, a dispute will lack the immediacy
necessary to support the exercise of declaratory judgment
jurisdiction. See Sierra, 363 F.3d at 1379. “[A] party
need not have engaged in the actual manufacture or sale
of a potentially infringing product to obtain a declaratory
judgment of non-infringement,” but “the greater the
length of time before potentially infringing activity is
expected to occur, the more likely the case lacks the
requisite immediacy.” Cat Tech, 528 F.3d at 881 (cita-
tions and internal quotation marks omitted); see also
Lujan v. Defenders of Wildlife, 504 U.S. 555, 564 (1992)
(“‘[S]ome day’ intentions—without any description of
11 MATTHEWS INTL v. BIOSAFE
concrete plans, or indeed even any specification of when
the some day will be—do not support a finding of the
‘actual or imminent’ injury that our cases require.”).
Here, Matthews’ dispute with Biosafe lacks the requisite
immediacy because it is unclear when, if ever, Matthews’
customers will use the Bio Cremation™ equipment in a
manner that could even arguably infringe the Method
Patents. See Benitec Austl., Ltd. v. Nucleonics, Inc., 495
F.3d 1340, 1346 (Fed. Cir. 2007) (concluding that there
was no declaratory judgment jurisdiction where a generic
drug manufacturer, who sought declaratory relief in 2005,
did not anticipate filing a new drug application with the
FDA until “at least 2010-2012, if ever” (citations and
internal quotation marks omitted)); see also Arris, 639
F.3d at 1374 (emphasizing that a party does not obtain
standing to obtain a declaratory judgment of non-
infringement simply because it has suffered “economic
injury” as a result of a patentee’s infringement allega-
tions); Prasco, LLC v. Medicis Pharm. Corp., 537 F.3d
1329, 1338 (Fed. Cir. 2008) (“MedImmune does not change
our long-standing rule that the existence of a patent is not
sufficient to establish declaratory judgment jurisdiction.”).
D. Reality
Matthews’ dispute with Biosafe likewise fails to meet
constitutionally-mandated reality requirements. “In the
context of patent litigation, the reality requirement is
often related to the extent to which the technology in
question is ‘substantially fixed’ as opposed to ‘fluid and
indeterminate’ at the time declaratory relief is sought.”
Cat Tech, 528 F.3d at 882 (citations omitted). Thus, “[t]he
greater the variability of the subject of a declaratory-
judgment suit, particularly as to its potentially infringing
features, the greater the chance that the court’s judgment
will be purely advisory, detached from the eventual,
actual content of that subject—in short, detached from
MATTHEWS INTL v. BIOSAFE 12
eventual reality.” Sierra, 363 F.3d at 1379. As both
Biosafe and Matthews acknowledge, the Bio Cremation™
equipment can be operated using a variety of process
parameters, some of which would not infringe the Method
Patents. See Br. of Defendants-Appellees at 8-9 (“Each of
the independent claims of the Method Patents has clearly
stated operating parameters that can be avoided to per-
form alkaline hydrolysis of a deceased human.”); Br. of
Plaintiff-Appellant at 26-27 (“[I]t is the essence of Mat-
thews’s case that Bio Cremation™ does operate outside of
[Biosafe’s] patents.”). Since Matthews has never provided
information regarding the specific parameters under
which its units will likely be operated, it would be impos-
sible to determine whether such operation could meet the
claim limitations contained in the Method Patents. As we
explained in Benitec, a party has no right to obtain de-
claratory relief when it provides “insufficient information
for a court to assess whether [its future activities] would
be infringing or not.” 495 F.3d at 1349.
Cat Tech, upon which Matthews relies, is inapposite.
There, we found that there was a justiciable controversy
where the declaratory judgment plaintiff had finalized the
design of four different configurations for devices used to
place catalyst particles into multi-tube chemical reactors.
528 F.3d at 880-82. The plaintiff stood ready, moreover,
to produce such devices upon receiving an order from a
customer. Id. at 881. Here, by contrast, there is no
indication that Matthews’ customers have settled upon a
fixed protocol for using the Bio Cremation™ equipment.
Because Matthews’ technology is “fluid and indetermi-
nate” rather than “substantially fixed,” its dispute with
Biosafe lacks the requisite reality to support the exercise
of declaratory judgment jurisdiction. Id. at 882; see
Sierra, 363 F.3d at 1379-80 (concluding that declaratory
relief was not available where development of the device
13 MATTHEWS INTL v. BIOSAFE
in question was “at an early stage” and its design was
“fluid and indeterminate” when the complaint was filed);
Telectronics, 982 F.2d at 1527 (affirming the dismissal of
a complaint where “[t]here was no certainty that the
device when approved would be the same device that
began clinical trials”); see also Int'l Harvester Co. v. Deere
& Co., 623 F.2d 1207, 1216 (7th Cir. 1980) (“Our concern
is not that the [product in question] will never be pro-
duced, but rather that because of the relatively early
stage of its development, the design which is before us
now may not be the design which is ultimately produced
and marketed.”). Simply put, because the operating
protocols for the Bio Cremation™ units are unknown, any
judicial determination as to whether operation of those
units could infringe the Method Patents would constitute
an advisory opinion based upon a hypothetical set of facts.
See Arctic Corner, Inc. v. United States, 845 F.2d 999,
1000 (Fed. Cir. 1988) (“At the heart of the ‘case or contro-
versy’ requirement is the prohibition against advisory
opinions.”).
E. The System Patent
The district court likewise correctly determined that it
had no jurisdiction over the System Patent. That patent
did not issue until nearly a month after Matthews filed its
complaint. There is no doubt that, under certain circum-
stances, a litigant is allowed to supplement his pleadings
to include events occurring after a complaint is filed. See
Fed. R. Civ. P. 15(d) (“On motion and reasonable notice,
the court may, on just terms, permit a party to serve a
supplemental pleading setting out any transaction, occur-
rence, or event that happened after the date of the plead-
ing to be supplemented.”). Here, however, because the
trial court had no jurisdiction over the Method Patents at
issue in Matthews’ original complaint, it was without
authority to consider the System Patent which issued
MATTHEWS INTL v. BIOSAFE 14
after that complaint was filed. “It has long been the case
that the jurisdiction of the court depends upon the state of
things at the time of the action brought.” Grupo Dataflux
v. Atlas Global Grp., L.P., 541 U.S. 567, 570-71 (2004)
(citations and internal quotation marks omitted); see also
GAF Bldg. Materials Corp. v. Elk Corp., 90 F.3d 479, 483
(Fed. Cir. 1996) (“[L]ater events may not create jurisdic-
tion where none existed at the time of filing.” (citations
and internal quotation marks omitted)). Thus, as the
trial court correctly concluded, absent “predicate jurisdic-
tion” based upon the Method Patents, it had no authority
to exercise jurisdiction over the System Patent. District
Court Decision, 2011 WL 4498935, at *10.
F. State-Law Claims
In addition to seeking a declaratory judgment of non-
infringement and invalidity with respect to the Method
and System Patents, Matthews also asserted state-law
claims for trade libel, defamation, and tortious interfer-
ence with contractual relations. Matthews, however,
failed to plead the bad faith element necessary to support
its state-law claims.
“[F]ederal patent law preempts state-law tort liability
for a patentholder’s good faith conduct in communications
asserting infringement of its patent and warning about
potential litigation.” Globetrotter Software, Inc. v. Elan
Computer Grp., Inc., 362 F.3d 1367, 1374 (Fed. Cir. 2004).
Accordingly, Matthews’ state-law claims could “survive
federal preemption only to the extent that those claims
[were] based on a showing of ‘bad faith’ action in asserting
infringement.” Id. Matthews alleges that Biosafe officials
made “thinly-veiled threats of liability” for patent in-
fringement to both Matthews’ employees and its custom-
ers. Even assuming arguendo that Biosafe made
infringement allegations, however, there is no evidence
15 MATTHEWS INTL v. BIOSAFE
that such allegations were objectively baseless. “A plain-
tiff claiming that a patent holder has engaged in wrongful
conduct by asserting claims of patent infringement must
establish that the claims of infringement were objectively
baseless.” Id. at 1377; Mikohn Gaming Corp. v. Acres
Gaming, Inc., 165 F.3d 891, 897 (Fed. Cir. 1998) (“In
general, a threshold showing of incorrectness or falsity, or
disregard for either, is required in order to find bad faith
in the communication of information about the existence
or pendency of patent rights.”). The Method Patents
disclose the use of an alkaline hydrolysis process to dis-
pose of various types of waste, such as medical waste and
hazardous waste, while the Bio Cremation™ equipment
uses an alkaline hydrolysis process to dispose of human
remains. Because Matthews points to nothing to indicate
that Biosafe’s alleged infringement allegations were so
unreasonable as to be objectively baseless, the trial court
correctly concluded that Matthews failed to sufficiently
plead the bad faith element necessary to support its state-
law claims. 5 See Dominant Semiconductors Sdn. Bhd. v.
5 Matthews asserts that Gordon I. Kaye and Peter
B. Weber, the applicants for several of the Method Pat-
ents, made false statements to the United States Patent
and Trademark Office when prosecuting their applica-
tions. Absent any evidence, however, that Biosafe itself
engaged in inequitable conduct—or had knowledge of
such conduct on the part of Kaye and Weber—there is no
showing of the bad faith required to support Matthews’
state-law claims. In order to survive Biosafe’s motion to
dismiss under Rule 12(b)(6), Matthews was required to do
more than make bald assertions that Biosafe acted in
“bad faith.” See Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (“Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not
suffice” to state a claim for relief); Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007) (“While a complaint
attacked by a Rule 12(b)(6) motion to dismiss does not
need detailed factual allegations, a plaintiff’s obligation to
MATTHEWS INTL v. BIOSAFE 16
OSRAM GmbH, 524 F.3d 1254, 1260 (Fed. Cir. 2008) (“To
be objectively baseless, the infringement allegations must
be such that no reasonable litigant could reasonably
expect success on the merits.” (citations and internal
quotation marks omitted)); see also Virtue v. Creamery
Package Mfg. Co., 227 U.S. 8, 37-38 (1913) (“Patents
would be of little value if infringers of them could not be
notified of the consequences of infringement, or proceeded
against in the courts. Such action, considered by itself,
cannot be said to be illegal.”). This court has “uniformly
upheld a patentee’s right to publicize the issuance of
patents and to so inform potential infringers.” Mikohn,
165 F.3d at 897.
Furthermore, as the trial court correctly concluded,
Matthews’ state-law claims would not be ripe for review
even if it had properly pled the required bad faith ele-
ment. See District Court Decision, 2011 WL 4498935, at
*14 (“[T]here is little hardship in waiting . . . until Mat-
thews has actually delivered its first units and Matthews’
customers have used them. Once the facts are actually
developed, a suit may be appropriate. At present, how-
ever, it is not.”). As noted previously, in order to ascertain
whether Biosafe’s infringement allegations were made in
“bad faith,” the trial court would be required to determine
whether those allegations were objectively baseless. The
court would have no basis for determining whether Bio-
safe’s infringement allegations were objectively baseless,
however, until it had some particularized knowledge as to
provide the grounds of his entitle[ment] to relief requires
more than labels and conclusions, and a formulaic recita-
tion of the elements of a cause of action will not do.”
(alteration in original) (citations and internal quotation
marks omitted)).
17 MATTHEWS INTL v. BIOSAFE
how Matthews’ customers planned to operate the Bio
Cremation™ equipment. Thus, until some specific evi-
dence regarding the operating parameters for the Bio
Cremation™ units is available, any determination as to
whether Biosafe acted unreasonably in asserting in-
fringement would be premature. See Texas v. United
States, 523 U.S. 296, 300 (1998) (“A claim is not ripe for
adjudication if it rests upon contingent future events that
may not occur as anticipated, or indeed may not occur at
all.” (citations and internal quotation marks omitted)).
III. CONCLUSION
Accordingly, the order of the United States District
Court for the Western District of Pennsylvania is af-
firmed.
AFFIRMED