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Citizen Electronics Co., Ltd. v. Osram GMBH

July 14, 2005

CITIZEN ELECTRONICS COMPANY, LTD., PLAINTIFF,
v.
OSRAM GMBH AND OSRAM OPTO SEMICONDUCTORS GMBH, DEFENDANTS.



The opinion of the court was delivered by: Ellen Segal Huvelle United States District Judge

MEMORANDUM OPINION

Plaintiff Citizen Electronics Company, Ltd. ("Citizen") filed suit on January 18, 2005, seeking a declaratory judgment that its white light emitting diodes ("LEDs") do not infringe upon the patents owned and assigned to Osram GMBH and Osram Opto Semiconductors GMBH (collectively "OSRAM"). Alternatively, plaintiff seeks a declaratory judgment that the patents are invalid. In response, defendants have moved to dismiss the complaint. Upon review of the pleadings and the record herein, the Court grants defendants' motion to dismiss because plaintiff has failed to prove that there was an actual controversy at the time the suit was filed, and thus, the Court lacks subject matter jurisdiction.

BACKGROUND

This action concerns seven patents issued to defendants OSRAM, headquartered in Germany. Each of the patents relates to devices that can produce LEDs, which are small semiconductor components that emit a variety of colors of light, including white light. Plaintiff, a Japanese company, has imported, offered to sell, and sold white LEDs in the United States prior to January 18, 2005.

Between January and October of 2003, Citizen and OSRAM exchanged letters about a potential licensing agreement. However, the companies never reached an agreement because Citizen maintained that it was not infringing OSRAM's patents and/or that the patents were invalid. (See Gasser Decl., Ex. 5.) OSRAM, on the other hand, repeatedly maintained that Citizen was infringing its patents. (Id. Ex. 4.) The last communication between the two companies was a letter sent on October 31, 2003. (Id. 5.)

While there was no further contact between the parties, OSRAM did file a complaint with the United States International Trade Commission ("ITC") pursuant to Section 337 of the Tariff Act of 1940 on May 6, 2004, relating to its patents. In the complaint, OSRAM alleged that the white LEDs manufactured and distributed by Dominant Semiconductors ("Dominant"), a small Malaysian manufacturer, and its two United States distributors, American Microsemiconductors Inc. and American Opto Plus Inc., infringed nine OSRAM patents.*fn1 (Sanders Decl., Ex. 5.)

On July 2, 2004, OSRAM moved to amend its ITC complaint to exclude American Opto Plus because the company had declared that it would no longer import into the United States or market LEDs manufactured by Dominant. And, on July 19, 2004, OSRAM issued a press release for publication to the industry. OSRAM praised American Opto Plus for "recogniz[ing] the importance of our patent portfolio." (Gasser Decl., Ex. 8.) In addition, OSRAM stressed "that the company would not tolerate any infringement of its patent rights and would take legal action against any unauthorized use." (Id.)

Thereafter, in November and December of 2004, there were two additional events relevant to OSRAM's patents, but neither involved Citizen. First, on November 2, 2004, the '500 patent was issued by the U.S. Patent and Trademark Office. The patent shares the same parent application as the '930 patent, but the '500 patent is broader. (See Pl.'s Opp'n at 9.) Then, according to plaintiff, during a hearing before the ITC on December 6, 2004 regarding its complaint against Dominant, OSRAM articulated an expansive interpretation of its patent rights by claiming that the existence of homogenous white light provides sufficient evidence of infringement. (See id.)

On January 18, 2005, Citizen brought this declaratory judgment action against OSRAM, requesting a declaration that its white LEDs do not infringe upon any of OSRAM's patents and/or such patents are invalid. Shortly thereafter, OSRAM filed suit against Citizen in Germany, seeking to protect its patent rights in Europe.*fn2 (See Defs.' Mot. at 28.)

OSRAM now moves to dismiss Citizen's declaratory judgment action pursuant to Fed. R. Civ. P. 12(b)(1), claiming that the Court lacks subject matter jurisdiction because Citizen fails to prove that there was an "actual controversy" when it filed suit, as required by the Declaratory Judgment Act, 28 U.S.C. § 2201(a).

LEGAL ANALYSIS

I. Standard of Review

When opposing a Rule 12(b)(1) motion, plaintiff has the burden of persuasion to establish by a preponderance of the evidence the existence of subject matter jurisdiction. See Thompson v. Capitol Police Bd., 120 F. Supp.2d 78, 81 (D.D.C. 2000). Although "the [C]court must accept the complaint's well-pled factual allegations as true and draw all reasonable inferences in the plaintiff's favor," id., where the motion to dismiss concerns a dispute over the facts alleged to establish subject matter jurisdiction, the Court "may not deny the motion to dismiss merely by assuming the truth of the facts alleged by the plaintiff and disputed by the defendant. Instead, the [C]court must go beyond the pleadings and resolve ...


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