Ryonet v. Lodsys et. al

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    1COMPLAINT FOR DECLARATORY JUDGMENT3/8/2012 6:16:07 PM RYOC.016

    Kurt M. Rylander, WSBA No. 27819

    [email protected]

    Mark E. Beatty, WSBA No. 37076

    [email protected]

    RYLANDER & ASSOCIATES PC

    406 West 12th StreetVancouver, WA 98660

    Tel: 360.750.9931

    Fax: 360.397.0473

    Attorneys for Plaintiff

    UNITED STATES DISTRICT COURT

    WESTERN DISTRICT OF WASHINGTONTACOMA DIVISION

    RYONET CORPORATION,

    a Washington Corporation,

    Plaintiff(s),

    v.

    LODSYS, LLC, a Texas limited

    liability company; and LODSYSGROUP, LLC, a Texas limited

    liability company,

    Defendant(s).

    No._________________

    COMPLAINT FOR

    DECLARATORY JUDGMENT

    (An action related to Patents)

    COMES NOW Plaintiff, RYONET CORPORATION, by and through

    undersigned counsel, and by this Complaint seeks declaratory judgment

    against Defendants LODSYS, LLC and LODSYS GROUP, LLC (collectively

    Lodsys), and alleges as follows:

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    2COMPLAINT FOR DECLARATORY JUDGMENT3/8/2012 6:16:07 PM RYOC.016

    JURISDICTION AND VENUE

    1. This is an action for a declaratory judgment that RYONET does

    not infringe any valid claim of United States Patent Nos. 5,999,908 (the "'908

    patent), 7,133,834 (the "'834 patent), 7,222,078 (the "'078 patent), and

    7,620,565 (the "'565 patent), and collectively hereinafter, the Asserted

    Patents", and for a declaratory judgment that the claims of the Asserted

    Patents are invalid.

    2. The United States Patent & Trademark Office has instituted

    reexamination proceedings related to the 078 patent and the 565 patent.

    3. Exhibit Ahereto, and incorporated herein, is a true and correct

    copy of the '908 patent.

    4. Exhibit B hereto, and incorporated herein, is a true and correct

    copy of the '834 patent.

    5. Exhibit C hereto, and incorporated herein, is a true and correct

    copy of the '078 patent.

    6. Exhibit D hereto, and incorporated herein, is a true and correct

    copy of the '565 patent.

    7. This action arises under the patent laws of the United States,

    Title 35 of the United States Code (35 U.S.C. 1, et seq.), and under the

    Federal Declaratory Judgment Act (28 U.S.C. 2201 and 2202).

    8. This Court has subject matter jurisdiction over this action

    pursuant to 28 U.S.C. 1331 (federal question) and 1338(a) (action arising

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    3COMPLAINT FOR DECLARATORY JUDGMENT3/8/2012 6:16:07 PM RYOC.016

    under an Act of Congress relating to patents).

    9. Plaintiff is informed and believes and on that basis alleges that

    this Court has personal jurisdiction over Lodsys because it has constitutionally

    sufficient contacts with Washington so as to make personal jurisdiction proper

    in this Court. Plaintiff is informed and believes and on that basis alleges that

    Lodsys maintains ongoing contractual relationships within this district and

    conducts or solicits business within this district.

    10. Venue is proper in this district pursuant to 28 U.S.C. 1391(b),

    (c) and 1400(b).

    11. There are presently pending or recently closed numerous

    declaratory judgment actions against Lodsys dealing with one or more of the

    Asserted Patents. In almost all, if not all, of these actions, in California,

    Wisconsin, Illinois, Arizona, and Texas, Lodsys has been represented by a

    Seattle firm, with offices only in the State of Washington, named Kelley,

    Donion, Gill, Huck & Goldfarb PLLC (www.kdg-Iaw.com.

    PARTIES

    12. Plaintiff, Ryonet Corporation (RYONET), is incorporated in

    Washington and has a principal place of business in Clark County,

    Washington. RYONET is an internet retailer of silk screen printing equipment

    and supplies.

    13. Plaintiff is informed and believes and on that basis alleges that

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    4COMPLAINT FOR DECLARATORY JUDGMENT3/8/2012 6:16:07 PM RYOC.016

    Defendant, Lodsys, LLC is a Texas limited liability company and claims to have

    a principal place of business at 505 East Travis Street, Suite 207, Marshall,

    Texas, 75670.

    14. Plaintiff is informed and believes and on that basis alleges that

    Defendant Lodsys Group, LLC is a Texas limited liability company and claims

    to have a principal place of business at 505 East Travis Street, Suite 207,

    Marshall, Texas, 75670.

    15. Plaintiff is informed and believes and on that basis alleges that

    Lodsys LLC and Lodsys Group LLC are alter egos of each other and/or that

    Lodsys Group is a mere continuation of Lodsys LLC, and that Lodsys Group

    LLC is otherwise liable fully for, and liable as if it was the same as, Lodsys,

    LLC. Hereinafter, Lodsys LLC and Lodsys Group LLC will be referred to

    simply as Lodsys.

    16. Plaintiff is informed and believes and on that basis alleges that

    Mark Small is the Chief Executive Officer of Lodsys, LLC and Lodsys Group

    LLC; and that Mr. Small conducts Lodsys' business from an office located in

    Wisconsin.

    17. Plaintiff is informed and believes and on that basis alleges that

    Lodsys owns the Asserted Patents.

    18. Plaintiff is informed and believes and on that basis alleges that,

    Lodsys agents and/or employees executives have made numerous trips to the

    State of Washington related to the Asserted Patents, and for licensing

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    5COMPLAINT FOR DECLARATORY JUDGMENT3/8/2012 6:16:07 PM RYOC.016

    negotiations with Washington based companies including Microsoft

    Corporation, Smilebox, Inc. and Photobucket Corporation (formally

    Photobucket, Inc.) among others, and potentially Intellectual Ventures.

    19. Plaintiff is informed and believes and on that basis alleges that

    Lodsys has engaged in, and continues to engage in, substantial licensing and

    other relationship, contracts, and financing in the State of Washington and

    with residents of the State of Washington.

    20. Plaintiff is informed and believes and on that basis alleges that

    Lodsys conducts business and engages in contracts and other substantive

    contact in the State of Washington, and by such extensive conduct, resides in

    the State of Washington.

    THE PRESENCE OF AN ACTUAL CONTROVERSY

    21. Plaintiff pays to third party vendor Provide Support $250 per

    month to use the Provide Support customer chat service.

    22. On January 3, 2012, Mr. Small of Lodsys sent a letter by Federal

    Express to Ryan Moor, President of RYONET. A copy of this letter is attached

    hereto as Exhibit E.

    23. The January 3, 2012 letter stated that it regarded RYONETs use

    of Provide Supports customer chat service as Infringement of U.S. Patent Nos.

    5,999,908, 7,133,834, 7,222,078, and 7,620,565 (Abelow)

    24. The January 3, 2012 letter also stated:

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    6COMPLAINT FOR DECLARATORY JUDGMENT3/8/2012 6:16:07 PM RYOC.016

    We have reviewed your use of the Lodsys Patents and have

    prepared the enclosed claim chart demonstrating at least

    one instance of how you utilize the inventions embodied in

    the Lodsys Patents. The images used in the charts are

    representative only and in addition to the charted claim of

    the referenced patent, you should consider the remainingclaims of that patent and the other Lodsys Patents both

    with respect to the charted utilization and to other products

    and services offered by you.

    25. The January 3, 2012 letter also stated that Lodsys has, among

    others, ''retained the firm[] of Kelley, Donion, Gill, Huck & Goldfarb PLLC

    (www.kdg-Iaw.com) based in Seattle, Washington, to assist the company in

    licensing of the Lodsys Patents."

    26. The January 3, 2012letter also stated:

    Notice

    Lodsys LLC reserves all rights with regard to the '908, '834,

    '078, and '565 patents, including: (1) the fight to seek

    damages anytime within the last six years that your

    comp