K. NICOLE MITCHELL, UNITED STATES MAGISTRATE JUDGE
Before the Court is Defendant ZTE Corporations Motion for Summary Judgment of Non-Infringement (Doc. No. 91). The Court held a hearing on this Motion on July 18, 2018. Defendants Motion for Summary Judgment of Non-Infringement is GRANTED-IN-PART.
BACKGROUND
Plaintiff Cellular Communications Equipment LLC (CCE) alleges that ZTE Corporation (ZTE) infringes the two asserted patents, United States Patent Nos. 7,941,174 (the 174 Patent) and 7,218,923 (the 8,923 Patent) (collectively, the patents-in-suit).
ZTE is a Chinese company organized under the laws of China, with its principal place of business in Guangdong, China. Doc. No. 91 at 3. ZTE (USA) is a wholly-owned subsidiary of ZTE. Doc. No. 109 at 2.
APPLICABLE LAW
Summary Judgment
Summary judgment is appropriate under Federal Rule of Civil Procedure 56 if the moving party demonstrates that there is no genuine dispute of material fact and that it is entitled to judgment as a matter of law. FED. R. CIV. P. 56(a). A genuine dispute as to a material fact exists if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A material fact is one that might affect the outcome of the suit under governing law. Id. The party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 325, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986).
The moving party, however, need not negate the elements of the nonmovants case. Little v. Liquid Air Corp. , 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc). The movants burden is only to point out the absence of evidence supporting the nonmoving partys case. Stults v. Conoco, Inc. , 76 F.3d 651, 655 (5th Cir. 1996). Once the moving party makes a properly supported motion for summary judgment, the nonmoving party must look beyond the pleadings and designate specific facts in the record showing that there is a genuine issue for trial. Id. All facts and inferences are viewed in the light most favorable to the nonmoving party. McFaul v. Valenzuela , 684 F.3d 564, 571 (5th Cir. 2012). Summary judgment may not be thwarted by conclusional allegations, unsupported assertions, or presentation of only a scintilla of evidence. Id.
DISCUSSION
ZTE seeks summary judgment that it does not: (1) directly infringe the patents-in-suit; (2) contributorily infringe the 8,923 Patent; and (3) actively induce infringement of the 8,923 Patent. Doc. No. 91 at 3.
As a threshold matter, Plaintiff responds that it does not contend that ZTE Corp. contributorily infringes the 8,923 Patent. Doc. No. 109 at 1 n.3. Thus, the Court GRANTS summary judgment with respect to Plaintiffs contributory infringement claim.
1. Direct Infringement
ZTE notes that liability for direct patent infringement under 35 U.S.C. § 271(a) requires an alleged infringer to make, use, offer to sell or sell any patented invention within the United States or import into the United States any patented invention during the term of the patent. ZTE argues that there is no evidence that ZTE made, used, offered to sell, or sold the Accused Products in the United States and is thus entitled to summary judgment for direct infringement. Doc. No. 91 at 1.
ZTE claims that CCE has failed to come forward with any evidence showing that ZTE Corporation has or does manufacture or otherwise make[s] any of the Accused Products in the United States. Doc. No. 91 at 5.
Plaintiff points to the testimony of ZTEs corporate representative, Waiman Lam, to show that ZTE imports the accused devices into the U.S. Doc. No. 109 at 3. ZTE specifically designated Lam to be knowledgeable about the marketing of devices sold in the United States by ZTE. Doc. No. 104-2.
During his 30(b)(6) deposition, Lam stated that ZTE takes delivery from ZTE Corp., once it gets to the U.S. Doc. No. 109-2 at 178:11-12. Plaintiff argues that Lams testimony creates a genuine issue of material fact with respect to ZTEs infringing activities in the U.S. Doc. No. 109 at 4.
ZTE argues that Lams testimony immediately following his statement indicates that he did not know whether the purchase took place before or after importation, and thus Plaintiff has no evidence that ZTE engaged in any infringing activity in the U.S. Doc. No. 126 at 1.
Here, Lams testimony creates a genuine issue of material fact. Lams statement that ZTE takes delivery from ZTE Corp., once it gets to the U.S. indicates that ZTE imports the accused devices into the U.S. Doc. No. 109-2 at 178:11-12. Defendants reliance on Lams lack of knowledge as to whether the purchase took place before or after ZTE USAs purchase of the devices does not negate the fact issue created by Lams testimony. Defendant cannot point to its own corporate representatives lack of knowledge, on a topic in which he was designated to speak as evidence that ZTE does not import the accused devices into the U.S.
Because Plaintiff has raised a genuine issue of material fact with respect to ZTEs infringing U.S. activities, Defendants Motion for Summary Judgment with respect to Plaintiffs direct infringement claims is DENIED.
2. Induced Infringement
ZTE argues that there is no evidence that ZTE had pre-suit knowledge of the 8,923 Patent or pre-suit awareness of potential infringement and thus no evidence to establish inducement under 35 U.S.C. § 271(b). Doc. No. 91 at 7. ZTE also notes that Plaintiffs infringement expert, Nigel Jones, does not offer an opinion that ZTE induces infringement of the 8,923 Patent.
Plaintiff argues that inducement does not require pre-suit knowledge, and only requires: (1) evidence of direct infringement and (2) that the defendant, with knowledge of the patent, actively and knowingly aided and abetted such direct infringement. Doc. No. 109 at 4. (quoting Meyer Intellectual Props. v. Bodum , 690 F.3d 1354, 1366 (Fed. Cir. 2012) ). Plaintiff cites Script Sec. Sols. L.L.C. v. Amazon.com, Inc. to show that the complaint [is sufficient] to show knowledge of the patents in suit. 170 F.Supp.3d 928, 937 (E.D. Tex. 2016) (Bryson, J.)
Plaintiff contends that ZTE does not base its motion on any purported failure by CCE to provide evidence for direct infringement ... [thus], the issue before the Court is whether Defendant knowingly aided and abetted such direct infringement. Doc. No. 109 at 4. Plaintiff notes that Defendants corporate representative, Wiaman Lam, testified that ZTE USA, a wholly owned subsidiary, exists to enable the sales between ZTE and the US carriers. Doc. No. 109-2 at 133:14-20.
Plaintiff also points to the Lams testimony that discusses the relationship between ZTE and ZTE USA. Lam stated that [ZTE USA] work[s] with Corp, and I believe Corp does most of the testings. But at some point, I think those devices have to enter the carriers lab. And there may be some folks from both ZTE USA and ZTE Corp thats working with the carriers. Doc. No. 109-2 at 32:9-13.
Plaintiff also notes that ZTEs corporate representatives-Minggang Gao and Dai Xiang-consistently refer to the U.S. carriers as their customers. Doc. No. 109-5 at 29:6-33:22-24;
51:23-52:4 and Doc. No. 109-4 at 29:6-8. Plaintiff contends that Lams testimony indicates that ZTE gives feedback on the proposals that ZTE USA delivers to the carriers, which indicates that ZTE was aware of and assists in ZTE USAs sale of the accused devices to the carriers. Doc. No. 109 at 6.
Here, Plaintiff has raised genuine issues of material fact with respect to inducement. Inducement requires: (1) knowledge of the patent and (2) knowledge that the induced acts constitute infringement. See Global-Tech Appliances, Inc. v. SEB S.A. , 563 U.S. 754, 766, 131 S.Ct. 2060, 179 L.Ed.2d 1167 (2011) ; Meyer Intellectual Props. , 690 F.3d at 1366.
Since pre-suit knowledge is not a prerequisite for inducement, the complaint provided ZTE with notice of the patent and that the sale of the accused devices infringed the 8,923 Patent. See Script. Sec. Sols. , 170 F.Supp.3d at 937.
Plaintiff has pointed to evidence that ZTE created ZTE USA to sell products to U.S. carriers and refers to the U.S. carriers as their customers. Doc. No. 109-2 at 133:14-20; Doc. No. 109-5 at 29:6-33:22-24, 51:23-52:4; and Doc. No. 109-4 at 29:6-8. Plaintiff has also provided evidence that ZTE was aware of ZTE USAs sales of the accused products to the U.S. carriers.
When viewed in the light most favorable to the non-moving party, Plaintiffs evidence is sufficient to create a reasonable inference of specific intent and thus raises a genuine issue of material fact with respect to inducement. Thus, ZTEs Motion for Summary Judgment with respect to induced infringement is DENIED.
CONCLUSION
Plaintiff has raised genuine issues of material fact with respect to its direct infringement and induced infringement claims. However, Plaintiff has stated that it no longer has a contributory infringement claim against ZTE. Thus, the Court GRANTS-IN-PART Defendants Motion for Summary Judgment of Non-Infringement (Doc. No. 91).
The Court GRANTS ZTE Corporations motion for summary judgment with respect to Plaintiffs contributory infringement claim for the 8,923 Patent.
The Court DENIES ZTE Corporations motion for summary judgment with respect to Plaintiffs direct infringement and induced infringement claims.
So ORDERED and SIGNED this 10th day of August, 2018.
ZTE only cites Wangs declaration for its Statement of Undisputed Material Facts. Doc. No. 91. While the Court granted Plaintiffs Motion to Exclude the Declaration of Qin Wang. (Doc. No. 159), the Court will still consider the Motion with ZTEs Statement of Undisputed Material Facts.