Texas Patent Litigation Monthly Wrap-Up: June 2024

This blog post was written in collaboration with Summer Associate James Mullen.

Universal Connectivity Tech. Inc. v. Dell Tech. Inc., 1-23-cv-01506 (W.D. Tex.), Dkt. No. 34, Report and Recommendation of Magistrate Judge Susan Hightower to Judge Pitman

A magistrate judge recommended denying defendant Dell Technologies, Inc.’s motion to dismiss in the Western District of Texas when Dell argued that pre-suit knowledge is a prerequisite for indirect infringement. Dell contended that the complaint lodged by plaintiff Universal Connectivity Technology, Inc. (UCT) was inadequate because it only claimed knowledge of the asserted patents from the infringement complaint and not before. Dkt. No. 18 at *4.

UCT countered by distinguishing Dell’s cited cases and reasserting that pre-suit knowledge is unnecessary for post-complaint indirect infringement. Dkt. No. 20 at *14n.4, *13. UCT drew upon a series of WDTX decisions, all of which were issued in the past two years, to support its position. UCT also cited one Federal Circuit case, In re Bill of Lading Transmission & Processing Sys. Pat. Litig., 681 F.3d 1323, 1342–45 (Fed. Cir. 2012). See Dkt. No. 20 at *13.

Dell responded by labeling UCT’s reply a “cherry-picked summary” that “paint[ed] a misleading picture of [the WDTX]’s law on the knowledge requirement of inducement.” Dkt. 24 at *6. Dell distinguished Bill of Lading and cited a series of cases from four other districts, two cases from its original motion, and six new WDTX cases to support its position. Dkt. No. 24 at *7–*8. Notably, none of its new WDTX decisions were issued after 2021.

Magistrate Judge Hightower acknowledged that “courts have reached different conclusions on [the] issue” of post-suit knowledge’s sufficiency for indirect infringement claims. Dkt. No. 34 at *10. Judge Hightower ultimately concluded that the center of gravity among the districts and the most recent WDTX cases weighs toward permitting post-suit indirect infringement claims to survive a motion to dismiss by pleading knowledge arising exclusively from the complaint. Id. Judge Pitman ultimately adopted Judge Hightower’s recommendation in full and denied Dell’s motion to dismiss. Dkt. No. 35.