A party sued for patent infringement may seek to transfer some or all of its liability through a claim for damages. While a patent infringement defendant may seek indemnification under Rule 14 of the Federal Rules of Civil Procedure, a recent decision from the Eastern District of Kentucky reiterates that third-party claims are limited to claims seeking to transfer the liability for underlying patent infringement. complaint. Linda’s Leather, LLC vs. ZambranoNo. 5:21-CV-046-CHB, 2022 WL 100216 (ED Ky. Jan. 10, 2022).
Linda’s Leather, LLC, sued Victor Zambrano for patent infringement. Zambrano then filed a third party complaint against Linda Scott, the sole member of Linda’s Leather and identified as the sole inventor of the claimed patents. Zambrano asserted four claims for declaratory relief in its third party complaint, stating that the patented inventions were the result of work done by Scott for Zambrano, making him at least a co-inventor on the patents, that his products n did not infringe and, alternatively, that the patents were invalid and that he had a license. Everyone was fired.
Critically, none of Zambrano’s declaratory judgment claims were an attempt to “transfer liability” to Scott, and “if proven, would not render Scott derivatively liable to Linda’s Leather” for the infringement claims. patent. Identifier. to *3-4. Under Rule 14(a)(1), “[i]mpleader is only appropriate where the third party defendant’s liability is secondary or derivative of the original defendant’s liability on the original plaintiff’s underlying claim. Identifier. at 2 o’clock. A third-party complaint is not an appropriate vehicle for “separate and independent” claims, even if they “arise from the same general set of facts as the underlying action”. Identifier. to *3-4. This contrasts with cross-claims under Rule 13(g). Under Rule 13(g), “[a] pleading may state as a crossclaim any claim of one party against a co-party whether the claim arises out of the transaction or event which is the subject of the original action or counterclaim”, and that “may include a claim that the party is or may be liable to the defendant for all or part of a claim made in the action against the defendant. Even though related to the same “general set of facts”, Zambrano’s claims for declaratory relief were dismissed because, if proven, they would have nullified its liability to Linda’s Leather for the underlying patent infringement claims. instead of shifting that responsibility to Scott.
The dismissal order is a reminder that a third party complaint is not a vehicle for all claims against a third party. Although a patent infringement defendant may have claims against a third party related to the underlying claims, only claims that seek to transfer liability for the underlying patent infringement claims should be brought before a third party. third party complaint.