Data Scape Limited v. Dell Technologies, Inc. et al

Western District of Texas, txwd-6:2019-cv-00129

Memorandum in Opposition to Motion, filed by Dell Inc., Dell Technologies, Inc., EMC Corporation, re [38] MOTION to Dismiss Inequitable Conduct Counterclaim and Strike Inequitable Conduct Affirmative Defense filed by Data Scape Limited

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6 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS WACO DIVISION DATA SCAPE LIMITED, Plaintiff, v. C.A. No. 6:19-cv-00129-ADA DELL TECHNOLOGIES INC., DELL INC., and EMC CORPORATION, Defendants. DEFENDANTS' OPPOSITION TO PLAINTIFF'S MOTION TO DISMISS INEQUITABLE CONDUCT COUNTERCLAIM AND STRIKE INEQUITABLE CONDUCT AFFIRMATIVE DEFENSE 6 TABLE OF CONTENTS Page I. INTRODUCTION ...............................................................................................................1 II. BACKGROUND .................................................................................................................2 III. LEGAL STANDARD ..........................................................................................................3 IV. ARGUMENT .......................................................................................................................3 A. Dell Adequately Pled the Who, What, Where, When, How, and Why Required to State a Claim for Inequitable Conduct ................................................ 3 B. Dell's Allegations Give Rise to a Reasonable Inference of Scienter ...................... 8 C. In the Alternative, Dell Requests Leave to Amend its Affirmative Defense and Counterclaim of Inequitable Conduct ............................................................ 10 V. CONCLUSION ..................................................................................................................10 i 6 TABLE OF AUTHORITIES Page(s) CASES 1st Media, LLC v. Electronic Arts, Inc., 694 F.3d 1367 (Fed. Cir. 2012) .......................................9 American GNC Corp. v. LG Electronics, Inc., No. 17-CV-01090, 2018 WL 400346 (S.D. Cal. Jan. 12, 2018) .......................................................................................10 Breville Party Ltd. v. Storebound LLC, No. 12-CV-01783, 2013 WL 1758742 (N.D. Cal. Apr. 24, 2013) ................................................................................................6, 8 Cabin Foods, LLC v. Rich Products Corp., No. 11-CV-00318, 2012 WL 433115, (W.D. Tex. Feb. 8, 2012) .....................................................................................................8 ContourMed Inc. v. American Breast Care L.P., No. 15-CV-02769, 2016 WL 1059531 (S.D. Tex. Mar. 17, 2016) .....................................................................................4 Cumberland Pharmaceuticals, Inc. v. Mylan Institutional LLC, No. 12-CV-03846, 2012 WL 6567922 (N.D. Ill. Dec. 14, 2012) ...................................................................6, 7 Delano Farms Co. v. California Table Grape Commision, 655 F.3d 1337 (Fed. Cir. 2011) .............................................................................................................................8 EMG Technology, LLC v. Dr. Pepper Snapple Group, Inc., No. 10-CV-00536, 2012 WL 13009200 (E.D. Tex. Sept. 20, 2012) ..................................................................5 Engineered Arresting Systems Corp. v. Runway Safe LLC, No. 15-CV-00546, 2016 WL 6087906 (W.D. Tex. Sept. 19, 2016) ...................................................................3 Eon Corp. IP Holdings, LLC v. T-Mobile USA, Inc., No. 10-CV-00379, 2011 WL 13134896 (E.D. Tex. Dec. 13, 2011) .............................................................................9, 10 Exergen Corp. v. Wal-Mart Stores, Inc, 575 F.3d 1312 (Fed. Cir. 2009) .......................3, 5, 6, 7, 8 Foman v. Davis, 371 U.S. 178 (1962) ...........................................................................................10 Fox Industries v. Structural Preservation Systems, 922 F.2d 801 (Fed. Cir. 1990) ........................5 Johnson Outdoors Inc. v. Navico, Inc., 774 F. Supp. 2d 1191 (M.D. Ala. 2011) .....................8, 10 Jones v. Greninger, 188 F.3d 322 (5th Cir. 1999) ...........................................................................3 Music Choice v. Stingray Digital Group Inc., No. 16-CV-00586, 2017 U.S. Dist. LEXIS 144081 (E.D. Tex. May 2, 2017) .............................................................................7 ii 6 Pollin Patent Licensing, LLC v. Capital One Auto Finance Inc., No. 10-CV- 07420, 2011 WL 5118891, (N.D. Ill. Oct. 25, 2011).......................................................7, 8 Richardson v. Axion Logistics, L.L.C., 780 F.3d 304 (5th Cir. 2015) .............................................3 Roxtec Inc. v. WallMax s.r.l., No. 17-CV-02105, 2018 WL 3870013 (S.D. Tex. Aug. 15, 2018) .....................................................................................................................4 SynQor, Inc. v. Cisco Systems, Inc., No. 11-CV-00054, 2012 WL 12892779 (E.D. Tex. Aug. 7, 2012) ...............................................................................................................3 Tyco Healthcare Group LP v. E-Z-EM, Inc., No. 07-CV-00262, 2009 WL 2998210 (E.D. Tex. Sept. 17, 2009) ....................................................................................5 United States ex rel. Steury v. Cardinal Health, Inc., 625 F.3d 262 (5th Cir. 2010).....................10 Versata Software, Inc. v. Internet Brands, Inc., No. 08-CV-00313, 2012 WL 226640 (E.D. Tex. Jan. 17, 2012) (Bryson, J., by designation) .......................................6, 7 Video Gaming Technologies, Inc. v. Castle Hill Studios LLC, No. 17-CV-00454, 2018 WL 284991 (N.D. Okla. Jan. 3, 2018) ........................................................................4 STATUTES, RULES, AND REGULATIONS 37 C.F.R. § 1.56(a)...........................................................................................................................5 Fed. R. Civ. P. 12(d) ........................................................................................................................4 Fed. R. Civ. P. 15(a) ......................................................................................................................10 iii 6 I. INTRODUCTION Defendants Dell Technologies Inc., Dell Inc., and EMC Corporation (collectively, "Dell") have adequately alleged inequitable conduct as to U.S. Patent No. 9,715,893 ("the '893 patent"). Plaintiff Data Scape Limited ("Data Scape") acquired the '893 patent (then a pending application) from Sony as part of the "Hirano patent family." At the same time and in the same transaction, Data Scape also acquired Sony's "Morohashi patent family." Both patent families describe and claim essentially the same subject matter, relating to music players and music data storage. And both were plainly acquired for the purposes of assertion—Data Scape is a licensing company and has since asserted the patents against at least 14 different defendants. But despite the common ancestry and subject matter—and Data Scape's apparent plans to assert the patents together—Data Scape continued to prosecute the Hirano '893 patent after the acquisition without citing the Morohashi patents or related applications and prior art. Data Scape attempts to paint this as a simple mistake, but its failure to disclose unmistakably material prior art cannot be ignored, considering that Data Scape acquired both patent families with an eye towards infringement litigation, and also continued to prosecute patents in both families. Data Scape's motion to dismiss confuses what is necessary to state a claim at the pleading stage, faulting Dell for providing "no evidence whatsoever." (ECF 38 at 1.) But Dell is not required to provide evidence or to prove its claim at this stage. Rather, based on Data Scape's history with the asserted patents, Dell has pled the necessary facts to support an inequitable conduct defense and counterclaim, including the circumstances of the fraud—the "who, what, where, when, how, and why"—and facts supporting a reasonable inference of wrongful intent. These are facts to be proven at trial, after discovery, not facts that must be established at the pleading stage. 1 6 II. BACKGROUND Because the nonmovant's allegations are presumed true during a motion to dismiss, the following facts alleged in Dell's pleadings are controlling. Data Scape acquired the '893 patent (then a pending application) from the original owner Sony no later than March 2017, along with other patents in the Hirano patent family. (ECF 35, ¶ 92.) In the same transaction, Data Scape also acquired the Morohashi patent family, including U.S. Patent No. 7,617,537 ("the '537 patent") and the other patents asserted in this litigation. (Id.) The Morohashi patent family including the '537 patent, as well as prior art cited during the prosecution of the '537 patent including U.S. Patent No. 6,577,735 ("Bharat"), specifically teach the same subject matter later claimed in the '893 patent. (Id. ¶¶ 94-95.) But Data Scape did not disclose either the '537 patent or Bharat to the Examiner during the prosecution of the '893 patent. (Id. ¶¶ 94-95.) Had these references been before the Examiner, the '893 patent would not have issued due to lack of novelty and/or obviousness. (Id. ¶ 95.) These facts are particularly significant given that Data Scape acquired the '893 patent— and the Hirano and Morohashi patent families more broadly—with the intention of asserting and/or licensing the patents to technology companies selling products in the United States. (Id. ¶ 96.) Data Scape and its counsel were familiar with the disclosures, claims, prosecution histories, and relevant prior art for both families since at least the diligence in connection with the acquisition. (Id. ¶¶ 96-98.) Specifically, at least attorney Terry Kramer—who Data Scape retained to take over and lead prosecution of the '893 patent following the acquisition—was aware of the material prior art, such as the '537 patent and Bharat, as shown by his simultaneous prosecution of applications in the Hirano and Morohashi patent families. (Id. ¶ 98.) Mr. Kramer deliberately chose not to disclose the '537 patent and Bharat during the prosecution of the '893 patent. (Id. ¶¶ 96-98.) 2 6 III. LEGAL STANDARD When ruling on a Rule 12(b)(6) motion to dismiss, the Court must "accept all well-pleaded facts as true and view those facts in the light most favorable to the [nonmovant]." Richardson v. Axion Logistics, L.L.C., 780 F.3d 304, 306 (5th Cir. 2015) (quotation marks omitted). "The issue is not whether the [nonmovant] will ultimately prevail, but whether he is entitled to offer evidence to support his claim." Jones v. Greninger, 188 F.3d 322, 324 (5th Cir. 1999). Similarly, a court may only strike an affirmative defense if it is "insufficient as a matter of law," under the same pleading requirements as complaints and counterclaims. Engineered Arresting Sys. Corp. v. Runway Safe LLC, No. 15-CV-00546, 2016 WL 6087906, at *2 (W.D. Tex. Sept. 19, 2016). IV. ARGUMENT A. Dell Adequately Pled the Who, What, Where, When, How, and Why Required to State a Claim for Inequitable Conduct As the Federal Circuit held in Exergen Corp. v. Wal-Mart Stores, Inc., although inequitable conduct must be plead with particularity, a defendant can meet this requirement by "identify[ing] the specific who, what, when, where, and how of the material misrepresentation or omission committed before the PTO." 575 F.3d 1312, 1326-27 (Fed. Cir. 2009).1 Dell's pleadings more than satisfy each of these requirements, thereby giving Data Scape "fair notice" of the inequitable conduct claim/defense Dell is advancing. See Engineered Arresting, 2016 WL 6087906, at *2. 1. Who: Exergen first requires "nam[ing] the specific individual associated with the filing or prosecution of the application" who failed to disclose material information. 575 F.3d at 1329. Data Scape concedes that "Dell's allegations admittedly do identify a single individual: Terry Kramer"— 1 Regional Fifth Circuit law governs the procedural aspects of Data Scape's motion, while Federal Circuit law governs the specific pleading standard for inequitable conduct. See SynQor, Inc. v. Cisco Sys., Inc., No. 11-CV-00054, 2012 WL 12892779, at *1-2 (E.D. Tex. Aug. 7, 2012). 3 6 who Data Scape retained to take over and lead the prosecution of the '893 patent after its acquisition. (ECF 38 at 7 (emphasis added); see also ECF 35, ¶ 98.) That should end the inquiry. But instead, Data Scape violates the central tenet that Dell's allegations must be taken as true at this stage. Specifically, Data Scape attempts to minimize Mr. Kramer's role in the '893 prosecution, claiming that "in reality" his involvement was "purely ministerial." (ECF 38 at 7-9.) The "reality" Data Scape attempts to paint, however, is irrelevant; Dell's allegations control and must be construed in the most favorable light. These allegations assert that Mr. Kramer was Data Scape's lead lawyer responsible for prosecuting the '893 patent after its acquisition and that Mr. Kramer also simultaneously filed a new application in the Morohashi patent family. (ECF 35, ¶ 98.) Notwithstanding Data Scape's attempt to cast blame on others (like Mr. Kramer's junior colleague and a legal assistant who apparently used Mr. Kramer's account to file prosecution papers (ECF 38 at 4)), the nature of Mr. Kramer's involvement is a question of fact on which Dell is entitled to discovery. Furthermore, Data Scape's extrinsic evidence—which is not even properly before the Court2—does not undermine Dell's allegations. Even if Sony's attorneys initially prosecuted the '893 patent, the "duty of candor" extends to all prosecuting attorneys, including Mr. Kramer. See 2 As a general rule, the Court does not consider materials beyond the pleadings at the motion to dismiss stage. Fed. R. Civ. P. 12(d). Without explanation, Data Scape nevertheless asserts that the Court should take judicial notice of extrinsic evidence related to Mr. Kramer. (ECF 38 at 3.) While taking judicial notice of public documents may be appropriate in some instances, it is improper to do so where the effect of the information contained therein may be disputed, as is the case here. See, e.g., Roxtec Inc. v. WallMax s.r.l., No. 17-CV-02105, 2018 WL 3870013, at *3 (S.D. Tex. Aug. 15, 2018) (declining to take notice of publicly available patent where opposing party disputed "the effect that the patent has on this case"); ContourMed Inc. v. Am. Breast Care L.P., No. 15-CV-02769, 2016 WL 1059531, at *2 (S.D. Tex. Mar. 17, 2016) ("[C]onsideration of prosecution history…is misplaced and premature at this stage in the pleadings."); Video Gaming Techs., Inc. v. Castle Hill Studios LLC, No. 17-CV-00454, 2018 WL 284991, at *3 (N.D. Okla. Jan. 3, 2018) ("[T]he effect of the information contained in the third-party USPTO filings…is subject to 'reasonable dispute' and therefore is not the proper subject of judicial notice."). Data Scape's motion and evidence should be rejected for this reason alone. 4 6 37 C.F.R. § 1.56(c)(2). After all, the "[t]he duty of candor extends throughout the patent's entire prosecution history," Fox Indus., Inc. v. Structural Pres. Sys. Inc., 922 F.2d 801, 803 (Fed. Cir. 1990), a period that "does not end when an application becomes allowed but extends until a patent is granted," EMG Tech., LLC v. Dr. Pepper Snapple Grp., Inc., No. 10-CV-00536, 2012 WL 13009200, at *3 (E.D. Tex. Sept. 20, 2012). And, tellingly, Mr. Kramer's firm, KramerAmado, P.C., is listed on the face of the '893 patent as the prosecuting firm. (ECF 1-4, [74]).) Even under a heightened pleading standard, Dell is not obligated to prove the merits of its inequitable conduct claim in its pleadings. See Tyco Healthcare Grp. LP v. E-Z-EM, Inc., No. 07-CV- 262, 2009 WL 2998210, at *2 (E.D. Tex. Sept. 17, 2009) (denying motion to dismiss where "Defendants' allegations, if true, would plausibly support their inequitable conduct claim"). Dell's alleged facts are sufficient to plead a violation of Mr. Kramer's duty of candor to the PTO. To the extent there is a dispute regarding Mr. Kramer's role in the prosecution of the '893 patent, such a dispute must be resolved in Dell's favor at this stage. 2. What/Where: Exergen next requires the pleadings "to identify which claims, and which limitations in those claims, the withheld references are relevant to, and where in those references the material information is found." 575 F.3d at 1329. Dell's allegations do exactly that: Dell identified independent claim 1 of the '893 patent as exemplary. (ECF 35, ¶ 95.) Dell specified the relevant limitations at issue in claim 1: "automatically identifying … one of the files of source data being absent from the second storage medium; and automatically transferring the one of the files of source data to the second storage medium." (Id.) Dell pointed to two references disclosing the specified limitations: the '537 patent (also at issue in this case) and the Bharat reference (cited during the prosecution of the '537 patent). (Id.) And Dell highlighted the relevant 5 6 teachings in the '537 patent and Bharat, illustrating that these references disclose the same invention claimed in claim 1 of the '893 patent. (Id.) Data Scape faults Dell for not providing a full "claim-by-claim" and "limitation-by- limitation" analysis. (ECF 38 at 9-10.) But Data Scape cites no case law demanding such a detailed analysis. Instead, Exergen is clear—it is necessary only to identify a specific claim limitation that forms the basis of Dell's inequitable conduct claim, and where material information relating to this limitation is found in the prior art. 575 F.3d at 1329; see also Versata Software, Inc. v. Internet Brands, Inc., No. 08-CV-00313, 2012 WL 226640, at *3 (E.D. Tex. Jan. 17, 2012) (Bryson, J., by designation) (rejecting argument that the defendants were obligated to allege how "each limitation of the claimed inventions was met by the asserted prior art"); Breville Pty Ltd. v. Storebound LLC, No. 12-CV-01783, 2013 WL 1758742, at *5 (N.D. Cal. Apr. 24, 2013) (identifying a single claim limitation "adequately identifies the claims and limitations to which the withheld references are relevant"); Cumberland Pharm., Inc. v. Mylan Institutional LLC, No. 12- CV-03846, 2012 WL 6567922, at *5 (N.D. Ill. Dec. 14, 2012) ("[R]equiring [defendant] to list each individual claim would be blind formalism."). 3. When: Data Scape does not challenge Dell's allegation as to "when" the material non- disclosure took place. Dell adequately alleged that Mr. Kramer took over prosecution of the '893 patent while it was pending, no later than June 20, 2017. (ECF 35, ¶ 98). 4. How/Why: Finally, under Exergen, a defendant must "identify the particular claim limitations, or combination of claim limitations, that are supposedly absent from the information of record…to explain both 'why' the withheld information is material and not cumulative, and 'how' an examiner would have used this information in assessing the patentability of the claims." 6 6 575 F.3d at 1329-30. Dell has done so. Dell identified the particular limitations of claim 1 that are found in the withheld '537 patent and Bharat. (ECF 35, ¶ 95.) Furthermore, Dell alleged: The Morohashi patent family [e.g., the '537 patent] and its corresponding prior art [e.g., Bharat] were not cumulative of the other art already of record in the pending application of the '893 patent. The Morohashi patent family [e.g., the '537 patent] and/or its corresponding prior art [e.g., Bharat] establishes, by itself or in combination with other prior art references, the unpatentability of the '893 patent for lack of novelty and/or obviousness. Had the Morohashi patent family [e.g., the '537 patent] and/or its corresponding prior art [e.g., Bharat] been presented to the Patent Office, the '893 patent would not have issued. (Id.) As many courts have found, these allegations are sufficient. See, e.g., Versata, 2012 WL 226640, at *3 ("alleg[ing] that the withheld information anticipated the claimed inventions" is sufficient to show information was material and non-cumulative); Music Choice v. Stingray Dig. Grp. Inc., No. 16-CV-00586, 2017 U.S. Dist. LEXIS 144081, at *6-7 (E.D. Tex. May 2, 2017) (finding sufficient allegations that withheld prior art references "would anticipate and/or render obvious" claims of the asserted patent); Cumberland, 2012 WL 6567922, at *5 ("explaining that the information would affect patentability by anticipating and/or rendering obvious all claims" is sufficient); Pollin Patent Licensing, LLC v. Capital One Auto Fin., Inc., No. 10-CV-07420, 2011 WL 5118891, at *3 (N.D. Ill. Oct. 25, 2011) ("Because [defendant] alleges that the withheld information was material and that the patent application would not have been granted if the prior art had been disclosed, the allegations are sufficient."). Data Scape contends that Dell was obligated to do more, essentially demanding that Dell analyze every reference on record to prove—in its pleadings—that the withheld information was not cumulative. Again, that is not the law. See Versata, 2012 WL 226640, at *3 ("It would go beyond even the enhanced pleading requirements of Exergen to require a party to demonstrate, by analyzing each of the references before the examiner, that an allegedly anticipating reference was 7 6 not cumulative."); Johnson Outdoors Inc. v. Navico, Inc., 774 F. Supp. 2d 1191, 1198 (M.D. Ala. 2011) ("[T]his is not an appropriate examination to conduct at the pleading stage."); Pollin, 2011 WL 5118891, at *3 ("At this stage of the litigation, it would be premature to engage in an analysis of whether or not the information was material to the PTO.").3 Dell's allegations that the '537 patent and Bharat would anticipate or render obvious the '893 patent are sufficient.4 B. Dell's Allegations Give Rise to a Reasonable Inference of Scienter As Exergen confirms, at the pleading stage, "knowledge and intent may be averred generally." 575 F.3d at 1327. To support these averments, pleadings must "allege sufficient underlying facts from which a court may reasonably infer that a party acted with the requisite state of mind." Id.; see also Delano Farms Co. v. Cal. Table Grape Comm'n, 655 F.3d 1337, 1350 (Fed. Cir. 2011). A reasonable inference is simply "one that is plausible and that flows logically from the facts alleged, including any objective indications of candor and good faith." Exergen, 575 F.3d at 1329 n.5. Dell's alleged facts easily meet this "reasonable inference" standard. Specifically, Dell has alleged that: • Data Scape acquired the '893 patent (at the time still a pending application) in the same transaction as the Morohashi patent family, including the '537 patent. (ECF 35, ¶ 92.) 3 Data Scape's citation to Cabin Foods, LLC v. Rich Prod. Corp. (ECF 38 at 10), is inapposite because, there, the allegations were deficient across the board: they did "not identify what prior art was omitted, what part of the prior art contained material information, when the false representations or omissions were made, or the omissions' relevance to any specific claims or claim limitations." No. 11-CV-00318, 2012 WL 433115, at *5 (W.D. Tex. Feb. 8, 2012). In contrast, Dell satisfied the pleading standard by "specifically identif[ying]" the information withheld. See Breville, 2013 WL 1758742, at *6. 4 Moreover, Data Scape's overly formalistic, pedantic approach to pleading is not supported by Exergen, which states that the very act of "identify[ing] the particular claim limitations…that are supposedly absent" from the record serves "to explain both" the why and how of materiality. 575 F.3d at 1329-30; see also Breville, 2013 WL 1758742, at *6 ("The Court does not read Exergen as requiring a court to determine, on the face of the pleadings, whether the allegedly missing material is in fact material and not cumulative."). 8 6 • Data Scape acquired these patents and applications from Sony "with the intention of asserting and/or licensing the patents to technology companies selling products in the United States." (Id. ¶ 96.) • Data Scape and its prosecution counsel "knew of the Morohashi patent family and their respective file histories since at least the diligence in connection with the acquisition of the portfolio from Sony." (Id. ¶ 98.) • Mr. Kramer and his colleagues were simultaneously prosecuting a patent application in the Morohashi patent family, i.e., an application sharing the same specification as the specifically identified '537 patent.5 (Id.) Together, these allegations support the reasonable inference that at least Mr. Kramer (and potentially others who may be identified through the course of discovery) had a motivation to hide the fact that at least the '537 patent and Bharat were invalidating art for the '893 patent (and possibly others in the Hirano patent family)—a fact that would have jeopardized Data Scape's monetization plans. Consequently, these allegations support the reasonable inference that at least Mr. Kramer knew of the material prior art and, by failing to disclose it, acted with specific intent to deceive the PTO. Data Scape contends Dell's allegations are not plausible, citing a case stating that the Court "can no longer infer intent to deceive from non-disclosure of a reference solely because that reference was known and material." (ECF 38 at 8 (quoting 1st Media, LLC v. Elec. Arts, Inc., 694 F.3d 1367, 1372-73 (Fed. Cir. 2012).) But that case discussed the standard for proving inequitable conduct at trial, applying Therasense's requirement that "specific intent to deceive must be 'the single most reasonable inference able to be drawn from the evidence.'" 1st Media, 694 F.3d at 1372-73 That is not the standard for pleading at the motion to dismiss stage. See Eon Corp. IP Holdings, LLC v. T-Mobile USA, Inc., No. 10-CV-00379, 2011 WL 13134896, at *4 (E.D. Tex. Dec. 13, 2011). 5 Data Scape contests Mr. Kramer's involvement in prosecuting this patent by pointing the finger at Mr. Kramer's junior colleague, Mr. Nuss, and a legal assistant who apparently used Mr. Kramer's account to file prosecution papers. (ECF 38 at 4.) Again, such factual disputes—and Data Scape's own interpretation of what certain documents may show—are not the proper focus at this stage of proceedings. 9 6 Indeed, courts across the country have warned that it is improper to "conflat[e] the burden of pleading inequitable conduct with that of proving inequitable conduct." See Johnson, 774 F. Supp. 2d at 1201; see also Eon Corp., 2011 WL 13134896, at *3-4; Am. GNC Corp. v. LG Elecs., Inc., No. 17- CV-01090, 2018 WL 400346, at *5 (S.D. Cal. Jan. 12, 2018). Accordingly, Dell "need not prove anything" in its pleadings, but merely must allege "enough underlying facts to give rise to a reasonable inference of deceptive intent." Johnson, 774 F. Supp. 2d at 1201. Furthermore, as clear from the allegations restated above, Dell did not rest on the allegation that Mr. Kramer was merely aware of the material prior art. Dell alleged additional facts supporting an inference that Mr. Kramer (and likely others) acted with specific intent to deceive the PTO, to avoid jeopardizing Data Scape's monetization of the recently acquired Hirano patents. This is all that is required at the pleading stage. C. In the Alternative, Dell Requests Leave to Amend its Affirmative Defense and Counterclaim of Inequitable Conduct Finally, as explained above, Dell's pleadings are sufficient. Nevertheless, to the extent the Court finds Dell's pleadings deficient, Dell seeks leave to amend. See Fed. R. Civ. P. 15(a) ("The court should freely give leave [to amend] when justice so requires."). Leave to amend should be granted unless there is evidence of "undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies, undue prejudice to the opposing party, or futility of a proposed amendment." United States ex rel. Steury v. Cardinal Health, Inc., 625 F.3d 262, 270 (5th Cir. 2010) (citing Foman v. Davis, 371 U.S. 178 (1962)). There is no such evidence here. V. CONCLUSION The Court should deny Data Scape's motion to dismiss and strike Dell's inequitable conduct allegations. Alternatively, the Court should grant leave for Dell to amend its pleadings. 10 6 Dated: May 24, 2019 Respectfully submitted, /s/ Shirley Cantin Deron Dacus Texas Bar No. 790553 THE DACUS FIRM, P.C. 821 ESE Loop 323, Suite 430 Tyler, TX 75701 Telephone: (903) 705-1117 Fax: (903) 581-2543 ddacus@dacusfirm.com Cynthia D. Vreeland Texas Bar No. 20625150 Shirley X. Li Cantin Massachusetts Bar No. 675377 WILMER CUTLER PICKERING HALE AND DORR LLP 60 State Street Boston, MA 02109 Telephone: (617) 526-6000 Fax: (617) 526-5000 Cynthia.Vreeland@wilmerhale.com Shirley.Cantin@wilmerhale.com E. Ross Cohen D.C. Bar No. 1542122 WILMER CUTLER PICKERING HALE AND DORR LLP 1875 Pennsylvania Avenue NW Washington, DC 20006 Telephone: (202) 663-6000 Fax: (202) 663-6363 Ross.Cohen@wilmerhale.com Attorneys for Dell Technologies Inc., Dell Inc., and EMC Corporation 11 6 CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the above and foregoing document has been served on all counsel of record via the Court's ECF system on May 24, 2019. /s/ Shirley Cantin Shirley Cantin 12