Judge Castel Rejects Laches and Equitable Estoppel Defenses

Masterson v. NY Fusion Merch., LLC

Case Number: 1:13-cv-06559-PKC (Dkt. 28)

Defendant moved to dismiss Plaintiff’s first amended complaint based on the affirmative defenses of laches and equitable estoppel.  The patents-in-suit are U.S Patent Nos. 7,980,095 (“Jewelry method and system”) and 8,479,536 (same) both directed to the field of customizable jewelry.

The court first considered whether an unreasonable delay in filing suit materially prejudiced the Defendant.  Judge Castel recognized that a six-year delay of filing suit creates a rebuttable presumption of laches, but noted that the delay between the patents’ issuance and the filing of the complaint was only sixteen months.  Further, the record was bare as to why such a delay was unreasonable.  Accordingly, Judge Castel held dismissal would be inappropriate, as it was sought under Rule 12(b)(6), requiring consideration based solely on the pleadings.  In light of the absence of unreasonable delay, Judge Castel declined to reach the issue of whether the time limit on damages in infringement cases bars application of the laches defense under Petrella v. Metro-Goldwyn Mayer, Inc., 134 S.Ct. 1962 (2014), which holds that because Congress enacted a statute of limitations on copyright infringement claims, laches could not be invoked to bar legal relief.

Judge Castel then turned to Defendant’s requested dismissal for equitable estoppel, which is established when a patentee, through misleading conduct, leads an alleged infringer to believe he did not intend to enforce his rights, there is reliance on such conduct, and there would be material prejudice if the patentee were permitted to proceed with his suit.  Again because the record was bare as to any misleading conduct on Plaintiff’s part, or Defendant’s reliance on such conduct, Judge Castel summarily denied the dismissal motion.

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