United States: Play The Cards In Your Hand: Limelight v. Akamai Does Not Open Door For New Divided Direct Infringement Theory

Motion to Amend Infringement Contentions Granted in Part and Denied in Part, Nalco Co. v. Turner Designs, Inc., Case No. 13-cv-02727 (Magistrate Judge Nathanael Cousins)

"The law is always evolving, but the parties must play with the legal cards they have, rather than the ones they hope to be dealt."

With that colorful analogy, Judge Cousins denied plaintiff Nalco's attempt to amend its infringement contentions to add a new direct infringement theory. Nalco argued that its proposed addition of a new theory was justified based on the Supreme Court's recent decision in Limelight Networks, Inc. v. Akamai Technologies, Inc., hoping to "preserve the ability to assert direct infringement if the Federal Circuit further articulates a theory of divided (but nonetheless direct) infringement." Judge Cousins disagreed. The Court in Limelight had limited its analysis to indirect infringement, so the decision did not make a direct infringement theory suddenly viable for Nalco, and divided direct infringement has never been the law.

The Supreme Court's dicta that the Federal Circuit was free to revisit its precedent on direct infringement did not permit Nalco to add a new divided direct infringement theory at the close of fact discovery.

While Nalco fared poorly in relying on new case law, it had better luck amending its contentions in light of new discovery. Judge Cousins granted Nalco leave to make two limited amendments. First, Nalco was permitted to identify the direct infringers in its indirect infringement claim against defendant Turner Designs based on the Court's finding that Nalco had diligently pursued third-party discovery and timely moved to amend thereafter. Second, Judge Cousins also permitted Nalco to add another version of the accused product, finding Nalco had only recently discovered that customers used it in an infringing manner. Because the asserted patent was a method patent, the court noted, "Nalco's ability to examine the [version of the accused product] was unhelpful without understanding how the product might be used to infringe the method."

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