United States District Court, D. Nebraska
BATTLE SPORTS SCIENCE, LLC, AND ACTIVE BRANDS COMPANY, LLC, Plaintiffs,
SHOCK DOCTOR, INC., Defendant.
MEMORANDUM AND ORDER
F. Rossiter, Jr. United States District Judge.
Sports Science, LLC (“Battle Sports”) and Active
Brands Company, LLC (“Active Brands”), both
Nebraska limited liability companies with their principal
places of business in Nebraska, bring this action against
Shock Doctor, Inc. (“Shock Doctor”), a Delaware
corporation with its principal place of business in
Minnesota. In their Amended Complaint (Filing No. 18), Battle
Sports and Active Brands allege, among other things, that
Shock Doctor infringed U.S. Patent No. 8, 931, 488 (the
“'488 Patent”), U.S. Patent No. 9, 333, 413
(the “'413 Patent”), U.S. Design Patent No.
D760, 889 (the “D'889 Patent”), and U.S.
Trademark Registration No. 4, 616, 238 (the “Registered
Trademark”) in violation of 35 U.S.C. § 271 and 15
U.S.C. §§ 1114, 1125. Now before the Court is Shock
Doctor's Motion to Dismiss the Amended Complaint pursuant
to Fed.R.Civ.P. 12(b)(1) and 12(b)(6) or, in the Alternative,
Transfer Venue pursuant to 28 U.S.C. § 1404(a) (Filing
No. 21). For the reasons explained below, the Motion is
granted in part and denied in part.
around 2011, Battle Sports, an athletic apparel and equipment
company, designed, developed, and marketed the Oxygen Lip
Protector mouth guard (“OLP”). Convinced the OLP
was like “no other mouth guard on the market” in
terms of appearance and function, Battle Sports applied for
the patents listed above to protect the innovative features
of its product.
January 13, 2015 and May 10, 2016, respectively, the U.S.
Patent and Trademark Office issued the '488 Patent and
the '413 Patent. On July 5, 2016, Battle Sports received
the D'889 Patent. On June 20, 2016, Battle Sports sold,
assigned, and transferred its “entire right, title and
interest” in the OLP patents to Active Brands,
“including all rights to damages for any and all past
infringement of the any patents covering the” OLP. That
same day, Battle Sports also sold, assigned, and transferred
to Active Brands its “entire right, title, and interest
in and to” the Registered Trademark, including the
right to past damages.
became a quick success. Soon after sales began to grow, Shock
Doctor began selling “a nearly identical mouth
guard”-the Max Airflow. In January 2015, Battle Sports
advised Shock Doctor that the Max Airflow infringed Battle
Sports's intellectual-property rights. Despite that
notice, Shock Doctor continued to sell the infringing Max
Airflow in 2015 and 2016 with only “superficial
21, 2016, Battle Sports sued Shock Doctor in the District of
Nebraska (8:16CV288), alleging patent infringement and other
violations of its intellectual property rights under federal
and state law. On July 29, 2016, Battle Sports voluntarily
dismissed that case pursuant to Federal Rule of Civil
15, 2016, Battle Sports and an entity described as Active
Brands, Inc. in the case caption and signature block and
Active Brands, LLC in the body of the Complaint (Filing No.
1) sued Shock Doctor in the District of Nebraska, again
alleging patent infringement and other violations of federal
and state law. On August 29, 2016, Shock Doctor moved to
dismiss the Complaint pursuant to Rule 12(b)(1) for lack of
subject matter jurisdiction and Rule 12(b)(6) for failure to
state a claim upon which relief could be granted (Filing No.
14). More specifically, Shock Doctor asserted the named
plaintiffs did not have constitutional standing to raise an
intellectual-property claim based on the OLP because Battle
Sports had “assigned away all of its ownership
interests in the asserted intellectual property” and
neither Active Brands, Inc. nor Active Brands, LLC was the
current owner of the OLP intellectual property rights-which,
according to the assignment documents, belonged to Active
August 19, 2016, Shock Doctor filed its own
intellectual-property claims against Battle Sports and Active
Brands in two separate cases in the District of Minnesota.
The first Minnesota case, 16-cv-02907, alleges Battle Sports
and Active Brands infringed a Shock Doctor patent for
compression shorts (the “Minnesota shorts case”).
The second Minnesota case, 16-cv-02908, sets forth Minnesota
state-law claims of false advertising, deceptive trade
practices, and unfair competition with respect to the OLP
(the “Minnesota OLP case”). On September 28,
2016, Battle Sports and Active Brands moved to dismiss the
Minnesota OLP case, arguing Shock Doctor's claims were
compulsory counterclaims in this case. They alternatively
moved to transfer both Minnesota cases to Nebraska. It
appears those motions are still pending.
response to Shock Doctor's Motion to Dismiss in this
case, Battle Sports and Active Brands filed an Amended
Complaint (Filing No. 18) on September 21, 2016. The Amended
Complaint listed Battle Sports and Active Brands as
plaintiffs, deleting any reference to Active Brands, Inc. and
Active Brands, LLC. In light of the filing of the Amended
Complaint, this Court terminated Shock Doctor's Motion to
Dismiss (Filing No. 14).
October 7, 2016, Shock Doctor filed the present Motion to
Dismiss, or in the Alternative, Motion for Transfer. Shock
Doctor maintains the Court should dismiss this case with
prejudice because (1) “the original plaintiffs lacked
constitutional standing” and (2) the allegations in the
Amended Complaint are insufficient to “state a
plausible claim to relief.” Should the Court find
dismissal unwarranted, Shock Doctor urges the Court to
transfer this case to the District of Minnesota to be tried
with the Minnesota OLP case, which Battle Sports and Active
Brands agree are related. Resisting dismissal and transfer,
Battle Sports and Active Brands counter that jurisdiction and
venue are proper in this Court and that the “amended
complaint states a plausible claim under Rule
Doctor argues this Court lacks subject-matter jurisdiction in
this case because neither of the plaintiffs listed on the
original Complaint owned the OLP intellectual property when
they filed suit and thus lack constitutional standing to sue.
See Brooks v. City of Des Moines, No. 15-2781, 2016
WL 6471225, at *1 (8th Cir. Nov. 2, 2016) (“Where a
plaintiff lacks standing, the court has no subject matter
jurisdiction.”). A jurisdictional challenge under Rule
12(b)(1) can be presented as either a “facial” or
“factual” challenge. Osborn v. United
States, 918 F.2d 724, 729 n.6 (8th Cir. 1990);
accord 3M Co. v. Avery Dennison Corp., 673 F.3d
1372, 1378 (Fed. Cir. 2012).
facial attack, “the court restricts itself to the face
of the pleadings, and the non-moving party receives the same
protections as it would defending against a motion brought
under Rule 12(b)(6).” Osborn, 918 F.2d at 729
n.6 (internal citations omitted). “In a factual attack,
the court considers matters outside the pleadings, and the
non-moving party does not have the benefit of 12(b)(6)
safeguards.” Id. (internal citation omitted).
Shock Doctor states that it presents both facial (as to
Battle Sports) and factual (as to Battle Sports and Active
Brands) challenges, but both parties rely on matters outside
the pleadings, so the Court will treat the challenges as
irreducible constitutional minimum of standing is that a
plaintiff show (1) an injury-in-fact that (2) is
‘fairly . . . traceable to the challenged action of the
defendant and (3) is likely . . . to be redressed by a
favorable decision in court.” ABF Freight Sys.,
Inc. v. Int'l Bhd. of Teamsters, 645 F.3d 954, 958
(8th Cir. 2011) (internal marks omitted) (quoting Lujan
v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992));
accord 3M Co. v. Avery Dennison Corp., 673 F.3d
1372, 1377 (Fed. Cir. 2012). An injury in fact is “an
invasion of a legally protected interest which is (a)
concrete and particularized and (b) actual or imminent, not
conjectural or hypothetical.” Lujan, 504 U.S.
at 560. “The party invoking federal jurisdiction bears
the burden of establishing” standing. Id. at
561. Battle Sports does not satisfy that burden.
in a patent infringement case is derived from the Patent Act,
which provides: ‘A patentee shall have remedy by civil
action for infringement of his
patent.'”Intellectual Prop. Dev., Inc. v. TCI
Cablevision of Cal., Inc., 248 F.3d 1333, 1345 (Fed.
Cir. 2001) (quoting 35 U.S.C. § 281). “The word
‘patentee' includes not only the patentee to whom
the patent was issued but also the successors in title to the
patentee.” 35 U.S.C. § 100(d); accord Morrow
v. Microsoft Corp., 499 F.3d 1332, 1339-40 (Fed. Cir.
2007). “[T]o assert standing for patent infringement,
the plaintiff must demonstrate that it held enforceable title
to the patent at the inception of the
lawsuit.” Paradise Creations, Inc. v. UV
Sales, Inc., 315 F.3d 1304, 1309 (Fed. Cir. 2003).
Battle Sports contends it has standing because the Complaint
“alleges direct injury in fact to Battle Sports during
the period Battles Sports was the patentee.”
Shock Doctor points out, under the terms of the Patent
Assignment Agreement, Battle Sports sold, assigned, and
transferred its “entire right, title and
interest” in the OLP patents to Active Brands,
“including all rights to damages for any and all past
infringement of the any patents covering the” OLP
before filing the Complaint. Thus, at the relevant time,
i.e., the inception of the lawsuit, Battle Sports no longer
had any interest in the patents or any past infringement
claims. See, e.g., Paradise Creations,
Inc., 315 F.3d at 1309. “If a party lacks title to
a patent, that party ‘has no standing to bring an
infringement action' under that patent.” Lans
v. Digital Equip. Corp., 252 F.3d 1320, 1328 (Fed. Cir.
2001) (quoting FilmTec Corp. v. Allied-Signal, Inc.,
939 F.2d 1568, 1571 (Fed. Cir. 1991)) (deciding a plaintiff
did not have standing to sue for patent infringement because
he had transferred title to the patent before filing suit);
accord Schreiber Foods, Inc. v. Beatrice Cheese,
Inc., 402 F.3d 1198, 1203 (Fed. Cir. 2005) (concluding
the plaintiff “lost standing to sue for
infringement” when it assigned its patent and
“all causes of action” related to the patent).
Sports next claims it “has standing to pursue equitable
claims for relief as the assignor of the patents.”
According to Battle Sports, it “has a direct interest
in establishing the validity of the patents transferred
because an adverse adjudication of the validity of the
patents could form the basis of [a] claim arising out of the
assignment.” Battle Sports provides no authority
supporting its assertion of standing on that basis, which is
dubious at best, particularly given the nature of Battle
Sports's assignment and the underlying allegations in
Court also rejects Battle Sports's undeveloped assertion
that it “has an equitable interest in seeking
enforcement of the patent as a corporate affiliate of Active
Brands.” Battle Sports's corporate disclosure
statement lists Active Brands as a parent. Battle
Sports's cited cases and meager argument do not convince
the Court that Active Brands's ownership of Battle Sports
creates some equitable interest in Battle Sports sufficient
to confer standing under the circumstances of this case.
Cf. Digitech Image Techs., LLC v. Newegg Inc., No.
2:12-CV-01688-ODW, 2013 WL 1871513, at *4 (C.D. Cal. May 3,
2013) (“The Federal Circuit has never held that a
corporate parent has equitable title in a subsidiary's
patents.”). Shock Doctor's motion to dismiss Battle
Sports for lack of constitutional standing is granted.
Brands maintains this Court has subject-matter jurisdiction
because “Active Brands possessed constitutional and
prudential standing at the time this case was filed, and any
amendment to the original complaint relates back to the date
of filing.” Noting its status “as the assignee of
Battle Sports' patents and trademarks related to the
[OLP], ” Active Brands explains that the references to
Active Brands, Inc. and Active Brands, LLC in the Complaint
were “mere” misnomers of its corporate status. As
Active Brands sees it, Federal Rules of Civil Procedure 15
and 17 allow Active Brands to “cure any misnomer of its
corporate status” and relate the change back to the
Rule 15(c)(1), which applies to proposed changes of
plaintiffs as well as defendants, an amendment changing a
party or the naming of a party relates back to the date of
the original complaint if the defendant knew or should have
known it would be asked to defend claims by the new plaintiff
and would not be unfairly prejudiced by the change.
See, e.g., Plubell v. Merck &
Co., 434 F.3d 1070, 1072 (8th Cir. 2006); Fed.R.Civ.P.
15 Advisory Committee Notes (1966) (explaining “[t]he
relation back of amendments changing plaintiffs is not
expressly treated in revised Rule 15(c) since the problem is
generally easier, ” but that “the attitude taken
in revised Rule 15(c) toward change of defendants extends by
analogy to amendments changing plaintiffs”).
17(a)(1) requires that an action “be prosecuted in the
name of the real party in interest.” Under Rule
The court may not dismiss an action for failure to prosecute
in the name of the real party in interest until, after an
objection, a reasonable time has been allowed for the real
party in interest to ratify, join, or be substituted into the
action. After ratification, joinder, or substitution, the
action proceeds as if it had been originally commenced by the
real party in interest.
support of its claim that its Amended Complaint relates back
to the date of the Complaint under the Federal Rules, Active
Brands relies on Hilgraeve Corp. v. Symantec Corp.,
212 F.R.D. 345, 346-47 (E.D. Mich. 2003), in which the court
granted a patent holder's motion for leave to amend its
complaint under Rules 15 and 17 to change the plaintiff's
name from “Hilgraeve Corporation, ” an entity
that did not exist, to the plaintiff's correct name of
Hilgraeve, Inc.” Rejecting the defendant's argument
that the court lacked subject-matter jurisdiction because the
named plaintiff did not have constitutional standing, the
court concluded the proposed amendment “would merely
correct a technical error in the complaint.”
Id. at 348.
court reasoned “[a] little common sense goes a long way
to show that the complaint contains a mere misnomer, and that
[Hilgraeve Inc. and Hilgraeve Corporation]
are one and the same.” Id. at 348 (alteration
in original) (quoting Hemphill Contracting Co. v. United
States, 34 Fed.Cl. 82, 86 (Fed. Cl. 1995)). The court
also decided the amendment should relate back to the
complaint under Rules 15(c) and 17(a) because the defendant
failed to demonstrate any prejudice. Id. at 348-49.
Active Brands urges the same result here.
response, Shock Doctor (1) emphasizes that Active Brands has
to prove that it had constitutional standing “when the
original complaint was filed, ” see,
e.g., Sicom Sys., Ltd. v. Agilent Techs.,
Inc., 427 F.3d 971, 975-76 (Fed. Cir. 2005)
(“Standing must be present at the time the suit is
brought.”), and (2) argues Active Brands “cannot
cure a defect in subject matter jurisdiction by amending the
Complaint, ” see, e.g., Paradise
Creations, Inc., 315 F.3d at 1310 (“[A] defect in
standing cannot be cured after the inception of the
lawsuit.”). According to Shock Doctor, Rules 15 and ...