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Judge Cote Reconsiders Dismissal and Reinstates Willfulness Allegations

On April 30, 2020, Judge Cote granted reconsideration of her March 4 dismissal of Plaintiffs Signify North America Corp. and Signify Holding B.V.’s (“Signify”) allegations of willful infringement against Defendant Axis Lighting Inc. (“Axis”).

In its amended complaint, Signify asserted seven patents directed to light-emitting diode (“LED”) lighting devices, and alleged that Axis “was aware of and had notice of” its alleged infringement at least after Signify notified Axis of the infringement prior to filing suit. 

Axis moved to dismiss Signify’s allegations of both direct infringement and willful infringement. 

In her March decision, Judge Cote denied Axis’s motion regarding direct infringement.  Judge Cote wrote that, under the Federal Circuit’s 2018 decision in Disc Disease Solutions Inc. v. GHS Solutions, Inc., a complaint survives a motion to dismiss if it “attaches the asserted patents to the complaint, specifically identifies the accused products and attaches photographs of them to the complaint, and alleges that ‘the accused products meet each and every element of at least one claim’ of the asserted patents.”  Although Signify’s amended complaint did not attach photographs of the accused products, the complaint satisfied the Disc Disease requirements and “sufficiently identified [the accused products] to give Axis notice of Signify’s claims of patent infringement.”  In a footnote, Judge Cote noted that some courts have read the Disc Disease standard to apply only to “simple technology,” but did not address whether she agreed or whether Signify’s patents were “simple technology.”

However, Judge Cote’s March decision dismissed Signify’s claims of willful infringement.  Judge Cote held that, although Signify alleges that Axis “was aware of and had notice of” the alleged infringement prior to the filing of the lawsuit, Signify “does not allege that Axis had knowledge of Signify’s patents at the time it began selling the accused products” – and, therefore, “Signify has failed to adequately plead facts supporting a claim of willful patent infringement.”

Signify moved for reconsideration, arguing that the amended complaint stated a claim of willfulness at least following Signify’s pre-suit notice letters to Axis.  On reconsideration, Judge Cote agreed.  She noted that Axis “acknowledged receipt of several of” Signify’s notice letters and “requested copies of the patents for evaluation,”  and that “[p]rior to initiating this lawsuit, Signify also provided Axis with a draft of the complaint detailing Axis’s infringing acts on a limitation-by-limitation basis.”  Judge Cote conceded that the March opinion “did not acknowledge the entirety of these allegations.”  Based on her re-examination of these allegations, Judge Cote held that Signify’s allegations “not only plead knowledge of Signify’s patents,” but also “support an inference that the infringement at issue was consciously wrongful,” and therefore state a claim for willful infringement. 

The case is Signify North America Corp. and Signify Holding B.V. v. Axis Lighting, Inc., No. 19-cv-5516 (DLC) (S.D.N.Y.).