ULTRA-MEK, INC. v. UNITED FURNITURE INDUSTRIES, INC.

IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF NORTH CAROLINA

ULTRA-MEK, INC., )

)

Plaintiff and )

Counter Defendant, )

)

v. ) 1:18CV281

)

UNITED FURNITURE INDUSTRIES, )

INC., OISEYS INTERNATIONAL, )

INC., MAN WAH HOLDINGS LTD., )

JIANGSU YULONG SMART )

TECHNOLOGY CO., LTD., )

REMACRO MACHINERY )

TECHNOLOGY CO., LTD., )

TAIZHOU CHENGUANG VEHICLE CO., )

LTD., and MAN WAH (USA), INC., )

)

Defendants and )

Counter Claimants. )

MEMORANDUM OPINION AND ORDER

OSTEEN, JR., District Judge

This matter comes before the court on Plaintiff Ultra-Mek,

Inc.’s (“Plaintiff” or “Ultra-Mek”) Motion for Summary Judgment,

(Doc. 134). Also before the court is the Motion for Summary

Judgment, (Doc. 142), filed Defendants United Furniture

Industries, Inc. (“UFI”); Oiseys International, Inc. (“Oiseys”);

Man Wah Holdings Ltd. (“Man Wah Holdings”); Jiangsu Yulong Smart

Technology Co., Ltd. (“Jiangsu”); Remacro Machinery Technology

Co., Ltd. (“RMT”); Taizhou Chenguang Vehicle Co., Ltd. (“TZ

Vehicle”); and Mah Wah (USA), Inc. (“Man Wah (USA)”) (together

“Defendants”).

I. FACTS AND PROCEDURAL HISTORY

A. Statement of the Facts

Plaintiff Ultra-Mek, Inc., is the assignee and owner of two

patents: both patents describe a reclining chair with

reciprocating capability. (First Amended Complaint (“Am.

Compl.”) (Doc. 31) ¶¶ 22–25.) Both patents were invented by

D. Stephen Hoffman and Marcus L. Murphy. (Id. ¶¶ 23-24.) U.S.

Patent Number 8,016,348 (the “‘348 patent”) was filed on

July 24, 2009 and issued on September 13, 2011. (See id., Ex. A

(Doc. 31-1).) U.S. Patent Number 8,297,693 (the “‘693 patent”)

was filed on September 9, 2011 and issued on October 30, 2012.

(See id., Ex. B (Doc. 31-2).) The ‘693 patent is a continuation

of the ‘348 patent, and the parties agree that the patents are

generally identical in nature and scope. (See Defs.’ Opening

Claim Constr. Br. (Doc. 92) at 131; Pl.’s Corr. Opening Claim

Constr. Br. (Doc. 94) at 6.)

According to Plaintiff, Defendants are producing and

selling seating units that infringe upon the relevant patents

1 All citations in this Memorandum Opinion and Order to

documents filed with the court refer to the page numbers located

at the bottom right-hand corner of the documents as they appear

on CM/ECF.

without Plaintiff’s permission. (Am. Compl. (Doc. 31) ¶ 26.)

Plaintiff further alleges that this infringement has continued

despite Defendants’ knowledge of the patents, while certain

Defendants have posted YouTube videos demonstrating how to

construct chairs using patented mechanisms. (Id. ¶¶ 28, 31, 34.)

Finally, Plaintiff alleges that certain Defendants violated a

permanent injunction issued in a prior case in this district by

importing and selling recliners covered by that injunction and

breached the settlement agreement in that case. (Id. ¶¶ 41–47,

66–67.)

B. Procedural History

Defendants answered the Amended Complaint, denied that

their products infringe the subject patents, and brought

counterclaims against Plaintiff. (See generally Docs. 38, 39.)

Plaintiff moved for claim construction of certain disputed terms

in the subject patents, (Doc. 91), and the parties submitted a

consent motion for a claim construction, or Markman, hearing.

(See Doc. 90.) This court held a Markman hearing on August 14,

2019. (See Minute Entry 08/14/2019.) This court issued a

Memorandum Opinion and Order construing the disputed terms on

September 26, 2019. (Doc. 124.) Plaintiff filed a Motion for

Summary Judgment on April 9, 2020. (Doc. 134.) Defendants filed

their own Motion for Summary Judgment on the same day. (Doc.

142.) Motions to Seal have also been filed by Plaintiff, (Docs.

137, 156, 164), and Defendants, (Docs. 145, 168) due to the

inclusion of financial and business information in the parties’

briefs. The court granted the motions to seal on March 22, 2021,

(Doc. 173).

II. LEGAL STANDARD FOR SUMMARY JUDGMENT

Summary judgment is appropriate when “there is no genuine

dispute as to any material fact and the movant is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56(a); see Celotex

Corp. v. Catrett, 477 U.S. 317, 322–23 (1986). A factual dispute

is genuine when “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 (1986); see also First

Nat’l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 289–90

(1968) (stating that a dispute is not genuine for summary

judgment purposes when one party rests solely on allegations in

the pleadings and does not produce any evidence to refute

alternative arguments). This court’s summary judgment inquiry is

whether the evidence “is so one-sided that one party must

prevail as a matter of law.” Liberty Lobby, 477 U.S. at 252. The

moving party bears the initial burden of demonstrating “that

there is an absence of evidence to support the nonmoving party’s

case.” Celotex Corp., 477 U.S. at 325. If the “moving party

discharges its burden . . . , the nonmoving party must come

forward with specific facts showing that there is a genuine

issue for trial.” McLean v. Patten Cmtys., Inc., 332 F.3d 714,

718-19 (4th Cir. 2003) (citing Matsushita Elec. Indus. Co. v.

Zenith Radio Corp., 475 U.S. 574, 586-87 (1986)). Summary

judgment should be granted “unless a reasonable jury could

return a verdict in favor of the nonmovant on the evidence

presented.” McLean, 332 F.3d at 719 (citing Liberty Lobby, 477

U.S. at 247–48).

In addition, “the mere existence of some alleged factual

dispute between the parties will not defeat an otherwise

properly supported motion for summary judgment.” Liberty Lobby,

477 U.S. at 247-48. “[T]he non-moving party must do more than

present a scintilla of evidence in its favor.” Sylvia Dev. Corp.

v. Calvert Cnty., 48 F.3d 810, 818 (4th Cir. 1995). Ultimately,

“there is no issue for trial unless there is sufficient evidence

favoring the nonmoving party for a jury to return a verdict for

that party.” Liberty Lobby, 477 U.S. at 249.

When facing cross-motions for summary judgement, this court

reviews “each motion separately on its own merits to determine

whether either of the parties deserves judgment as a matter of

law.” Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir. 2003)

(citations and internal quotation marks omitted). “When

considering each individual motion, the court must take care to

resolve all factual disputes and any competing, rational

inferences in the light most favorable to the party opposing

that motion.” Id. (citation and internal quotation marks

omitted).

III. ANALYSIS

A. Claim Preclusion

Plaintiff moves for summary judgment on (1) UFI’s Third and

Fourth Counterclaims of Invalidity and First through Sixth

Affirmative Defenses; (2) Oiseys’ Third and Fourth Counterclaims

of Invalidity and First through Sixth Affirmative Defenses; and

(3) TZ Vehicle, Man Wah (USA), Man Wah Holdings, RMT, and

Jiangsu’s Third and Fourth Counterclaims of Invalidity and First

and Second Affirmative Defenses. (Doc. 134 at 1-2 n.1.)

Plaintiff’s motion for summary judgment centers around whether

claim preclusion applies in this case. A prior action involving

the same patents, Ultra-Mek, Inc. v. Man Wah (USA), Inc., No.

1:16-cv-00041-NCT-JLW (M.D.N.C. Jan. 15, 2016) (hereinafter “Man

Wah I”), yielded a settlement agreement, a stipulation of

dismissal, and Permanent Injunction, (Doc. 54-1), prohibiting

certain Man Wah parties from producing any “seating units and

mechanisms that perform substantially the same function in

substantially the same way to yield substantially the same

result.” (Pl.’s Br. in Supp. of Summ. J. (“Pl.’s Br.”) (Doc.

135) at 7.) Plaintiff alleges that Defendants in this case are

all subject to claim preclusion regarding invalidity and these

affirmative defenses.

1. Waiver of Claim Preclusion

Before assessing the merits of Plaintiff’s argument for

claim preclusion, this court will first address Defendants’

contention that Plaintiff has waived any claim preclusion

defense. (Defs.’ Opp’n to Pl.’s Mot. for Summ. J. (“Defs.’

Resp.”) (Doc. 152) at 11-12.) Defendants argue that under Fed.

R. Civ. P. 8(c), claim preclusion has not been timely pleaded

and therefore has been waived and cannot be argued at this

stage. (Id. at 11.) Defendants contend that Plaintiff could have

raised the argument “in its answers to any of Defendants’

counterclaims of invalidity”, or “in any of its interrogatory

responses,” rather than waiting until the summary judgment

stage. (Id.)

The Fourth Circuit has not laid out a precise rule for when

a preclusion defense must be raised, however, a party must at

minimum “raise its preclusion defenses ‘at the first reasonable

opportunity.’” Ga. Pac. Consumer Prods., LP v. Von Drehle Corp.,

710 F.3d 527, 533–34 (4th Cir. 2013) (quoting Aetna Cas. & Sur.

Co. v. Gen. Dynamics Corp., 968 F.2d 707, 711 (8th Cir. 1992)).

Though few courts have more specifically interpreted Georgia

Pacific’s “first reasonable opportunity,” at least one court in

this Circuit has interpreted this language as asking whether the

party making a preclusion argument acted “in good faith and with

due diligence” to determine if preclusion was raised “within a

reasonable period.” HSBC Bank USA, Nat’l Ass’n v. Resh, Civil

Action No. 3:12-cv-00668, 2013 WL 6230670, at *5 (S.D. W. Va.

Dec. 2, 2013).

This court agrees with Plaintiff that the full account of

the facts and scope of this case, and therefore the full

argument that this claim has already been adjudicated, came to

light “only after” this court’s Markman Order. (Pl.’s Br. in

Reply to Defs.’ Opp’n to Pl.’s Mot. for Summ. J. (“Pl.’s Reply”)

(Doc. 162) at 5.) Moreover, in Georgia Pacific, the claim

preclusion argument at issue was first brought not only after

the judgment was entered, but after appeal. 710 F.3d at 528.

Those facts are hardly comparable to the present case, in which

Plaintiff raised its claim preclusion argument in April 2020,

(Doc. 134), in its first substantive filing after the Markman

Order was issued on September 26, 2019, (Doc. 124). No evidence

of bad faith on the part of Plaintiff has been presented, and

the argument was raised within a reasonable time after this

court’s Markman Order.

Separately, regardless of timeliness, Plaintiff maintains

that its claim preclusion argument responds to Defendants’

invalidity counterclaim, which is itself a defense, 35 U.S.C.

§ 282 (1994), thereby making the claim preclusion argument “a

defense to a defense.” (Pl.’s Reply (Doc. 162) at 5.) This,

Plaintiff contends, means “waiver is not appropriate.” (Id.)

Though Plaintiff provides no authority protecting “a defense to

a defense” from waiver, this court finds that Plaintiff has

raised the issue within a reasonable period and has therefore

not waived its claim preclusion argument regardless.

2. Legal Standard for Claim Preclusion

Claim preclusion ensures “that a right, question or fact

distinctly put in issue and directly determined by a court of

competent jurisdiction cannot be disputed in a subsequent suit

between the same parties.” Aliff v. Joy Mfg. Co., 914 F.2d 39,

42 (4th Cir. 1990) (alteration in original) (quoting S. Pac.

R.R. v. United States, 168 U.S. 1, 48–49 (1897)). In order to

determine whether claim preclusion requires a finding of

infringement, this court must assess several factors. Three

elements are needed to bar a claim on res judicata grounds: “(1)

a judgment on the merits in a prior suit resolving (2) claims by

the same parties or their privies, and (3) a subsequent suit

based on the same cause of action.” Id.; see also Montana v.

United States, 440 U.S. 147, 153 (1979) (“Under res judicata, a

final judgment on the merits bars further claims by parties or

their privies based on the same cause of action.”).

a. Judgment on the Merits in Prior Action

The first factor for the court’s consideration is whether

the prior action resulted in a final judgment. The Settlement

Agreement in Man Wah I resulted in a dismissal with prejudice.

(Pl.’s Br. (Doc. 135 at 7.) Plaintiff contends, and Defendants

do not dispute, that “a stipulation of dismissal with prejudice

is a final judgment on the merits.” (Id. at 23). See also Ford-

Clifton v. Dep’t of Veterans Affairs, 661 F.3d 655, 660 (Fed.

Cir. 2011) (“It is widely agreed that an earlier dismissal based

on a settlement agreement constitutes a final judgment on

the merits in a res judicata analysis.”).

b. Privity of Parties

Claim preclusion also requires that the same parties be

involved in the action, or else parties in privity with those in

the original case. Gross v. Weingarten, 217 F.3d 208, 217 (4th

Cir. 2000) (“It is an axiom of collateral estoppel . . . that

the defendants can be bound . . . only if they were parties, or

in privity to a party.”); Comite de Apoyo a los Trabajadores

Agricolas (CATA) v. U.S. Dep’t of Labor, 995 F.2d 510, 514 (4th

Cir. 1993) (“Nor is Fairview in privity with DOL, such that it

would be bound by our judgment as a non-party.”). In this pair

of cases, the parties partially differ. Man Wah I bound the

defendants “and [their] members, agents, representatives,

employees, successors, and assigns, and all others in active

concert or participation with them.” (Doc. 54-1 at 4.) Man Wah

Holdings, and RMT were all involved in the previous case. There

is no further need to demonstrate privity for those defendants

in analyzing claim preclusion.

Plaintiff argues that the Defendants new to this action are

in privity with the parties present in the previous case.

Privity between parties can be established if the new party is

“so identified in interest with a party [from the previous]

litigation that he represents precisely the same legal right in

respect to the subject matter involved.” Jones v. SEC, 115 F.3d

1173, 1180 (4th Cir. 1997) (internal quotation marks omitted).

“The concept of privity requires an alignment of interests and

not an exact identity of parties,” and thus the privity inquiry

“centers on the closeness of the relationship in question.”

Weinberger v. Tucker, 510 F.3d 486, 492 (4th Cir. 2007). This

court will assess the relevant Defendants separately to

determine whether they are in privity with the defendants in Man

Wah I. The new Defendants in this case include Jiangsu, TZ

Vehicle, UFI, and Oiseys.

i. Jiangsu

First, Plaintiff argues that Jiangsu is in privity with

parties from Man Wah I. Jiangsu is “under control of the same

management team” as both RMT and Man Wah Holdings. (Pl.’s Br.

(Doc. 135) at 8-9.) Plaintiff alleges that Jiangsu “is 80% owned

by RMT and 20% owned by Cheggung Yuan.” (Id. at 16.) RMT, in

turn, which itself was named in the Settlement Agreement of Man

Wah I, is “93% owned by Man Wah Industrial Co., Ltd. under Man

Wah Holdings Ltd.” (Id.) Plaintiff highlights that the corporate

board of Jiangsu includes the Chairman of Man Wah Holdings, a

second Man Wah Holdings director, and the general manager of

RMT. (Pl.’s Reply (Doc. 162) at 15-16.) The relationship between

Jiangsu and RMT/Man Wah Holdings is clearly incredibly close, if

not entirely that of full formal ownership. The parties’

interests with respect to this action appear to overlap almost

entirely – if not completely. Jiangsu appears to be in privity

for purposes of this case with Man Wah Holdings and RMT, both

parties to the previous action.

ii. TZ Vehicle

TZ Vehicle is somewhat more removed from the Man Wah

Holdings organization than Jiangsu. However, TZ Vehicle is

nevertheless owned by the same family that owns and directs

Jiangsu and Oiseys. (Id. at 17.) In Universal Furniture, this

court found that an individual defendant was in privity with a

prior corporate defendant because he was “the Vice President,

Chief Operating Officer, Secretary, Treasurer, and part owner”

of the prior corporate defendant. Universal Furniture Int’l,

Inc. v. Frankel, 835 F. Supp. 2d 35, 41 (M.D.N.C.

2011), aff’d, 538 F. App’x 267 (4th Cir. 2013). While Defendants

“do not concede” that TZ Vehicle is in privity with the parties

in Man Wah I, (Defs.’ Resp. (Doc. 152) at 27 n.8), they offer no

facts to counter Plaintiff’s explanation that TZ Vehicle is

closely identified with the Man Wah I settlement parties due to

“significant overlapping ownership and familial control,” (Pl.’s

Br. (Doc. 135) at 16), as well as shared counsel and

demonstrated common business interests, (id. at 17). Plaintiff

moved, in part, for summary judgment on the Third and Fourth

Counterclaims of Invalidity and the First and Second Affirmative

Defense of TZ Vehicle, Man Wah (USA), Man Wah Holdings, RMT, and

Jiangsu. (Pl.’s Br. (Doc. 135) at 1-2 n.1.) All of these

parties were either in the prior action or are in privity to

those parties from the prior action. Thus, the claim preclusion

analysis with regard to these segments of the Motion for Summary

Judgment may proceed to the next prong. However, the analysis

cannot end there for Plaintiff’s other summary judgment

requests. Defendants’ brief focuses on UFI and Oiseys,

contending that those two entities in particular are not in

privity with the Man Wah I parties.

iii. UFI

Both UFI and Oiseys are “separate entities that sold

products well before Man Wah I and were not involved in that

litigation.” (Defs.’ Resp. (Doc. 152) at 27.) UFI “has no

relationship with Man Wah or its subsidiaries aside from buying

components to integrate into its products,” and was “not a party

to the previous litigation or settlement agreement.” (Id.)

Plaintiff, on the other hand, argue that UFI is in privity

with the Man Wah I parties. UFI purchased the seating units at

issue from TZ Vehicle and Jiangsu, in what Plaintiff describes

as “a closely linked supply chain.” (Pl’s Br. (Doc. 135) at 20.)

The primary basis of Plaintiff’s argument is the existence of an

indemnification agreement between UFI and Jiangsu in the present

action. Id. at 21. No additional facts demonstrate when the

indemnification agreement was reached or what role Man Wah I may

have played in the signing of such a contract. Defendants allege

the indemnification agreement is a “boilerplate dealing[]” that

serves as a “standard supplier-buyer arrangement.” (Defs.’ Resp.

(Doc. 152) at 30.)

Plaintiff contends that indemnification in this instance

“supports a finding of privity in the context of claim

preclusion or collateral estoppel.” (Pl.’s Br. (Doc. 135) at

21.) Plaintiff relies heavily on a case from the Northern

District of California, in which a court found that “[b]ecause

[the prior litigant] is contractually obligated to indemnify

defendants for any losses stemming from a finding of

infringement, the court finds that the parties are in privity.”

SpeedTrack, Inc. v. Office Depot, Inc., No. C 07-3602 PJH, 2014

WL 1813292, at *6 (N.D. Cal. May 6, 2014). However,

“[w]hile indemnification is some evidence of privity,

indemnification alone does not mandate a finding of privity.”

Earth Res. Corp. v. United States, 44 Fed. Cl. 274, 286 (1999).

See also H&S Tool, Inc. v. Austerman, No. C-3-07-331, 2008 WL

420036, at *4 (S.D. Ohio Feb. 14, 2008). A more holistic

analysis of control is necessary, as “preclusion is appropriate

only if the putative agent’s conduct . . . is subject to the

control of the party who is bound by the prior adjudication.”

Taylor v. Sturgell, 553 U.S. 880, 906 (2008). The Fourth Circuit

has made clear that the test for privity “centers on the

closeness of the relationship in question.” Weinberger, 510 F.3d

at 492. Indemnification does not automatically guarantee such

closeness. Moreover, the agreement is between UFI and Jiangsu –

Jiangsu was not itself a party to Man Wah I, though it is in

privity with the Man Wah I parties for purposes of this action.

Plaintiff argues the “interconnectedness” of Jiangsu and the

other defendants is “a coordinated effort by Man Wah,” (Pl.’s

Reply (Doc. 162) at 15), automatically making UFI closely linked

with all of the Man Wah organization due solely to the

indemnification agreement. However, Plaintiff provides few other

facts to support this theory of UFI’s closeness.

The only other fact connecting UFI to the Man Wah

organization is the shared legal counsel of UFI and the Man Wah

organization. However, privity “requires more than a showing of

parallel interest or use of the same attorney.” H&S Tool, 2008

WL 420036, at *4. See also Wills v. Arizon Structures Worldwide,

L.L.C., 824 F.3d 541, 546 (5th Cir. 2016) (finding no privity in

spite of shared counsel); Waddell & Reed Fin., Inc. v. Torchmark

Corp., 243 F. Supp. 2d 1232, 1255 (D. Kan. 2003) (no privity

found even though the entities “share common counsel” and shared

common ownership); Hartford Accident & Indem. v. Columbia Cas.

Co., 98 F. Supp. 2d 251, 257 (D. Conn. 2000) (“[W]hile the fact

that [the parties] have been represented by . . . the

same counsel is considered in the privity analysis, . . .

Hartford has not carried its burden of demonstrating that

Columbia is in privity with Continental.”). Indemnification and

shared counsel are substantial considerations in privity

analysis, but these two factors alone have been presented to the

court as evidence of closeness. On the other hand, Defendants

point out that UFI is a separate entity that sold products “well

before Man Wah I”, and “has no relationship with Man Wah or its

subsidiaries aside from buying components to integrate into its

products.” (Defs.’ Resp. (Doc. 152) at 27.) No reasonable jury

could find that the high bar for finding privity between UFI and

the Man Wah I parties has been met at this stage in the

proceedings.

iv. Oiseys

Plaintiff also argues that Oiseys is in privity with the

settlement parties from Man Wah I. The owner of Oiseys,

Plaintiff notes, is a director of Jiangsu, and the son of the

owner of Jiangsu. Due to this overlapping familial ownership,

Plaintiff contends Oiseys is in privity with Jiangsu. Plaintiff

further claims that since Jiangsu is in privity with the parties

from Man Wah I, Oiseys is in privity with those parties as well.

This court agrees that Jiangsu is in privity with the

parties from Man Wah I. See discussion infra III.A.2.b.i.

However, the weak link lies in Plaintiff’s attempt to link

Oiseys to Jiangsu. The primary overlap between the companies is

that Steven Yuan, the owner of Oiseys, is the son of Jiangsu’s

owner and serves as a director on Jiangsu’s board. (Pl.’s Br.

(Doc. 135) at 17.) Additionally, the CEO of Man Wah (USA)

“attended a mediation” on behalf of Oiseys, Jiangsu, and the

other involved companies - other than UFI. (Id. at 18.)

A parent company and its subsidiary are in privity for

purposes of claim preclusion. Whitehead v. Viacom, 233 F. Supp.

2d 715, 721 (D. Md. 2002). However, Oiseys is not formally a

subsidiary of the Man Wah organization. On one hand, the use of

a common attorney does indicate that Oiseys has shared interests

with Jiangsu and the other Man Wah entities. However, while

Plaintiff has demonstrated that Oiseys is extensively linked

with the rest of the Man Wah organization, little evidence is

provided demonstrating the level of closeness of relationship

necessary for privity. Plaintiff relies on another case in which

this court found privity for purposes of collateral estoppel

under different circumstances.

[B]ased on the nature of Defendant’s participation in

the [prior litigation] and his role as an executive

officer and part owner of [the prior defendant

corporation], this court finds that Defendant’s

interests were aligned with those of [the prior

defendant corporation] such that the defense . . .

that was mounted also constituted representation of

Defendant’s legal right to contest . . . liability.

Universal Furniture, 835 F. Supp. 2d at 42. In Universal

Furniture, the relevant defendant had actively participated in

the prior litigation. Id. Oiseys itself played no role in Man

Wah I. Moreover, Oiseys has no ownership stake in any of the

companies involved in the Man Wah I settlement. Rather, the

closest allegation is that the individual owner of Oiseys is a

director – with no alleged ownership stake – of Jiangsu.

Jiangsu, while almost entirely owned by Man Wah I parties, and

now involved in the sale of furniture, was not involved directly

in Man Wah I either. The link between Oiseys and the Man Wah I

parties is too attenuated to find privity for the purposes of

claim preclusion.

c. Same Cause of Action

Finally, where privity exists, whether two causes of action

are identical for claim preclusion purposes depends on “whether

the claim presented in the new litigation arises out of the same

transaction or series of transactions as the claim resolved by

the prior judgment.” Laurel Sand & Gravel, Inc. v. Wilson, 519

F.3d 156, 162 (4th Cir. 2008) (internal quotation marks

omitted). In patent cases, “claim preclusion does not apply

unless the accused device in the action before the court is

‘essentially the same’ as the accused device in a prior action

between the parties that was resolved by a judgment on the

merits.” Acumed LLC v. Stryker Corp., 525 F.3d 1319, 1324 (Fed.

Cir. 2008).

The central question determining the application of claim

preclusion where privity exists centers around whether the

devices in Man Wah I are ‘essentially the same’ as the devices

in the present action. “While the court looks to Fourth Circuit

law as to general principles of claim preclusion . . . , whether

two patent infringement claims are identical is an issue

specific to patent law and, thus, must be governed by legal

principles established by the Federal Circuit.” SV Int’l, Inc.

v. Fu Jian Quanyu Indus. Co., 820 F. Supp. 2d 677, 683–84

(M.D.N.C. 2011). Devices are considered essentially the same

“where the differences between them are merely ‘colorable’

or ’unrelated to the limitations in the claim of the

patent.’” Acumed, 525 F.3d at 1324.

Plaintiff argues that the accused products in the two cases

are essentially the same, noting that “both cases involve

seating units that are the same, or at most, colorable

imitations of each other.” (Pl.’s Br. (Doc. 135) at 23.)

Plaintiff paints the products with a broad brush, noting that

both cases deal with “seating units capable of reclining between

three positions: an upright position, an intermediate ‘TV’

position, and a fully reclined position.” (Id. at 23-24.)

Furthermore, Plaintiff argues, the accused products in both

cases “have the same components: a seat, a backrest, a base

unit, and an extendable ottoman.” (Id. at 24.) The similarities

also extend to the use of “reclining mechanisms that include[] a

linear actuator to provide the force required for the seating

unit to recline between the three aforementioned positions.”

(Id. at 26.) Plaintiff’s expert backs up this analysis,

submitting that “[i]n comparing the functions of the Asserted

Patents or the 4152 unit to that of the RMT mechanism, the units

perform substantially the same function in substantially the

same way to achieve substantially the same result.” (Technical

Report, Author: Rufus R. Brown, II (“Brown Report”) (Doc.

136-10) at 44.)

Defendants, on the other hand, argue that “there are

material differences between [the RMT mechanism at issue in Man

Wah I] and the mechanisms accused here.” (Defs.’ Resp. (Doc.

152) at 13.) Defendants highlight two specific differences

between the designs: first, the differing movement and

positioning of the ottoman in the “TV position,” (id. at 15),

and second, differing linkage components in the two chairs, (id.

at 19-20). Though Plaintiff’s expert counts the mechanisms’

similarities, (Brown Report (Doc. 136-10), Defendants present

the expert report of Dr. Kimberly Cameron in contrast, (Expert

Report of Dr. Kimberly Cameron (“Cameron Report”), (Doc. 152-5).

Dr. Cameron highlights a multitude of allegedly material

differences between the products in this case and the RMT

mechanism at issue in the Man Wah I products. She ultimately

concludes that “the RMT Mechanism is substantially different

from the 4152 mechanism.” (Cameron Report (Doc. 152-5) ¶ 177.)

Where there is substantive dispute, the question of whether

accused products are “essentially the same” is a question of

fact typically left to the factfinder, rather than determined as

a matter of law. See Foster v. Hallco Mfg. Co., 947 F.2d 469,

480 (Fed. Cir. 1991) (at summary judgment, court found “it

inappropriate to rule on the evidence of ‘material differences’

in the first instance and [instead] leave it to the trial court

to determine whether this suit is based on a different claim”);

Certusview Techs., LLC v. Usic, LLC, Case No. 2:14cv373, 2014 WL

12591937, at *9 (E.D. Va. Dec. 15, 2014) (denying motion to

dismiss, where “the parties dispute whether the products at

issue in this case are essentially the same as those involved in

the [prior] action”, deeming it a “factual dispute”). At this

stage, this court could only grant summary judgment if no

reasonable jury could find that the products are colorably

different. This court does not believe Plaintiff’s arguments

have met that standard.

Defendants have alleged ample differences between the

products to create a genuine issue of material fact for a jury.

Thus, even though some Defendants are in privity with the Man

Wah I parties, this court will deny Plaintiff’s Motion for

Summary Judgment.

B. Infringement Claim

Defendants’ motion for summary judgment first seeks

judgment on questions of infringement, asking the court to find

that “Defendants have not infringed any of claims 7-11, 13, and

14 of the asserted ‘348 patent and claims 1, 2, and 4-9 of the

asserted ‘693 patent.” (Doc. 142.) A plaintiff may prove direct

infringement by proving either literal infringement or

infringement under the doctrine of equivalents. Cross Med.

Prods., Inc. v. Medtronic Sofamor Danek, Inc., 424 F.3d 1293,

1310 (Fed. Cir. 2005).

Under the doctrine of equivalents, “a product or process

that does not literally infringe upon the express terms of

a patent claim may nonetheless be found to infringe if there is

‘equivalence’ between the elements of the accused product or

process and the claimed elements of the patented invention.”

Warner–Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 21

(1997). The Supreme Court has held that the doctrine of

equivalents must be applied in a precise manner, holding that

“[e]ach element contained in a patent claim is deemed material

to defining the scope of the patented invention, and thus the

doctrine of equivalents must be applied to individual elements

of the claim, not to the invention as a whole.” Id. at 29. The

court therefore “must consider each element of the allegedly

infringed claim to determine whether there is equivalence

between each of those elements and the accused device or

method.” N5 Techs. LLC v. Capital One N.A., 56 F. Supp. 3d 755,

760 (E.D. Va. 2014). “If there is not equivalence between the

accused device or method and any one element of the patent claim

in issue, then there is no infringement under the doctrine of

equivalence.” Id. at 760–61.

Defendants argue that the accused products do not meet the

opposed-ends limitation, even under the doctrine of equivalents,

written in the ‘348 patent as follows:

[w]herein the power actuating unit includes opposed

first and second ends, and wherein the first end of

the power actuating unit moves forwardly as the

seating unit moves from the upright position to the TV

position, and wherein the second end of the power

actuating unit moves rearwardly when the seating unit

moves from the TV position to the fully reclined

position.

(‘348 Patent (Doc. 101-1) col. 7 lines 9-15.) Defendants argue

that the accused products do not possess an actuating unit with

“opposed first and second ends,” and even if they do, those

opposed ends do not move as specified in the patent. (Defs.’ Br.

(Doc. 143) at 14.) The actuating unit used on the accused

products is instead a “carriage-style” actuator, which

Defendants allege is completely different from the actuating

unit envisioned by the patent. (Id.)

“To establish literal infringement, every limitation set

forth in a claim must be found in an accused product, exactly.”

Southwall Techs., Inc. v. Cardinal IG Co., 54 F.3d 1570, 1575

(Fed. Cir. 1995). This does not apply here: the carriage-style

actuator does not have literal opposed ends in the format

envisioned by the patent. However, Plaintiff primarily relies on

an infringement theory based on the doctrine of equivalents.

Differences in structure that prevent a finding of literal

infringement do not prevent a finding of infringement under the

doctrine of equivalents. See Remington Arms Co. v. Modern

Muzzleloading, Inc., No. 2:97CV00660, 1999 WL 281341, at *6

(M.D.N.C. Feb. 9, 1999) (“[D]ifferences in structure between

Plaintiff’s 700 ML and Defendant’s DISC Rifle does not impede a

finding of infringement under the doctrine of equivalents.”).

The doctrine of equivalents instead requires that, with regard

to each element of the patent claim, “two devices do the same

work in substantially the same way, and accomplish substantially

the same result, they are the same.” Graver Tank & Mfg. Co. v.

Linde Air Prods. Co., 339 U.S. 605, 608 (1950). This is what

Defendants correctly call the “function-way-result test.”

(Defs.’ Br. (Doc. 143) at 16.) Defendants argue that the

existence of only one carriage-style actuator excludes the

possibility of any infringement, since the carriage-style

actuator is “substantially different, both in design and in the

way [it] move[s] a load, from the actuating units required by

the Claims-at-Issue.” (Id. at 20.) Indeed, even “[w]here an

accused device performs substantially the same function to

achieve substantially the same result but in a substantially

different manner, there is no infringement under the doctrine of

equivalents.” Dolly, Inc. v. Spalding & Evenflo Cos., 16 F.3d

394, 400 (Fed. Cir. 1994).

However, Plaintiff presents evidence supporting its

contention that the mechanism does, in fact, perform

substantially the same function in substantially the same way to

achieve substantially the same result. Plaintiff’s expert

identifies two distinct endpoints on the actuator to meet the

opposed ends requirement. (Brown Report (Doc. 136-10) at 13.) He

describes the “second end” of the actuator moving “rearwardly,

in substantially the same way.” (Expert Report of Rufus Brown

Responding to Expert Report of Dr. Kimberly Cameron Concerning

Infringement (Doc. 136-19) ¶ 42.) As Plaintiff notes, by

contending this argument is an attempt at further claim

construction, the claim as defined does not require further

specificity as to what constitutes an opposed end – the

“positional limitation” Defendants “attempt to impose” is not

inherent in the patent or discussed in this court’s Markman

Order. (Pl.’s Br. in Opp’n to Defs. Mots. for Summ. J. (“Pl.’s’

Resp.”) (Doc. 154) at 14.) Moreover, Plaintiff identifies the

carriage – identified by Plaintiff’s expert as the second end -

moving “rearwardly,” as required by the patent. Plaintiff argues

that “the first end of the actuating unit moves forward when the

seating unit moves from the upright to the TV position,” while

“the second end of the actuating unit moves rearwardly” when the

chair adjusts “[f]rom the TV position to the fully reclined

position.” (Id. at 18.) Plaintiff’s characterization is in line

with the patent’s claims and construction.

While the claim construction phase of an infringement claim

is a matter of law for the court, “[w]hether a claim encompasses

an accused device, either literally or under the doctrine of

equivalents, is a question of fact.” Zelinski v. Brunswick

Corp., 185 F.3d 1311, 1315 (Fed. Cir. 1999). This means that in

the summary judgment context, “[w]hether a claim

is infringed under the doctrine of equivalents may be decided

on summary judgment if no reasonable jury could determine that

the limitation and the element at issue are equivalent.” Id. at

1317. Here, Plaintiff and Defendants present opposing

characterizations of the mechanism – it is not this court’s role

to weigh the credibility of each factual contention regarding

the accused products. A reasonable jury could feasibly find

equivalence based on the evidence presented, and this court will

therefore deny the motion for summary judgment on the issue of

infringement.

C. Limitation of Damages

Defendants request that the court limit the damages

available against them on multiple bases, ranging from critiques

of Plaintiff’s expert to denials of proper notice.

1. Reliability of Plaintiff’s Damages Witness

Defendants’ first argument critiques the testimony of

Plaintiff’s expert, Mr. Graham D. Rogers, and his methodology in

calculating damages. (Defs.’ Reply in Supp. of Mots. for Summ.

J. (“Defs.’ Reply”) (Doc. 167) at 16.) Rule 702 provides that

testimony by an expert witness must be “based on sufficient

facts or data” and be “the product of reliable principles and

methods.” Fed. R. Evid. 702(a)-(d); see also Bresler v.

Wilmington Tr. Co., 855 F.3d 178, 195 (4th Cir. 2017). A

challenge to a witness’ reliability under Rule 702 is governed

by Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 (1993).

Daubert analysis, typically raised in a motion to exclude expert

testimony rather than a motion for summary judgment, requires

two analytical determinations. First, “whether an expert’s

testimony reflects ‘scientific knowledge,’ [and is] “‘derived by

the scientific method,’” and second, “whether the expert’s

testimony is ‘relevant.’” Doe v. Ortho-Clinical Diagnostics,

Inc., 440 F. Supp. 2d 465, 469 (M.D.N.C. 2006) (quoting Daubert,

509 U.S. at 590, 597)).

Defendants do not make a formal Daubert argument regarding

Plaintiff’s expert, Mr. Rogers, and this court does not believe

an exhaustive Daubert analysis is necessary here. Defendants

claim Mr. Rogers’ estimation of the “lump-sum up front payment

. . . based on anticipated future sales” is inaccurate, arguing

his comparator for anticipated sales was inappropriate. (Defs.’

Reply (Doc. 167) at 16-17.) Though Defendants provide their own

analysis critiquing Mr. Rogers’ approach, they do not provide a

countervailing expert to discount his methodology. Defendants

also provide no contrary evidence of differing sales

projections. (Id. at 17.) Mr. Rogers’ report relies on, as

Plaintiff points out, “actual sales data,” and provides

substantial explanation of his methods. In terms of their

challenge to his methodology, Defendants appear to be

challenging the use of certain values based on the license with

Leggett & Platt. (Defs.’ Br. (Doc. 143) at 28-29.) This

objection is to the particular values Mr. Rogers used in his

calculations, rather than the actual methodology employed – and

assessing “the values [the expert] chose to assign to certain

variables” is a matter of weight and credibility, not

admissibility. Bresler, 855 F.3d at 195. Mr. Rogers’ testimony

will not be excluded on the basis of this summary judgment

motion.

2. Pre-Action Notice

Defendants also argue that this court should limit the

damages available against them due to a lack of notice regarding

potential infringement prior to the initiation of this action.

See Limelight Networks, Inc. v. XO Commc’ns, LLC, 241 F. Supp.

3d 599, 608 (E.D. Va. 2017) (“To seek damages for patent

infringement occurring before the initiation of a lawsuit, a

patentee must have placed the allegedly infringing party on

notice about the patent’s existence.”). Notice can be provided

in two separate ways: “[a] patentee can place others on notice

either constructively, by marking its patented articles with a

patent number, or actually, by specifically communicating the

existence of the patent.” Id.

Whether notice of potential infringement has been properly

provided under 35 U.S.C. § 287(a) is typically a matter for the

jury – however, Defendants request summary judgment declaring

notice was not provided prior to the suit. Since “compliance

with the marking statute is a question of fact,” in order to

receive summary judgment, Defendants need to demonstrate that

“no reasonable jury could find that the patentee either has or

has not provided . . . notice to the ‘particular defendants by

informing them of his patent and of their infringement of it.’”

Banner Pharmacaps Inc. v. Perrigo Co., No. 1:04 CV 492, 2005 WL

2136927, at *7 (M.D.N.C. Aug. 1, 2005) (quoting Amsted Indus.

Inc. v. Buckeye Steel Castings Co., 24 F.3d 178, 187 (Fed. Cir.

1994)).

a. Marking

In lieu of actual notice, constructive notice can be

provided via marking of products. 35 U.S.C. § 287 provides that:

Patentees, and persons making, offering for sale, or

selling within the United States any patented article

for or under them, or importing any patented article

into the United States, may give notice to the public

that the same is patented . . . by fixing thereon the

word “patent” . . . . In the event of failure so

to mark, no damages shall be recovered by the patentee

in any action for infringement, except on proof that

the infringer was notified of the infringement and

continued to infringe thereafter, in which event

damages may be recovered only for infringement

occurring after such notice. Filing of an action for

infringement shall constitute such notice.

35 U.S.C. § 287(a).

Therefore, if a “patentee makes or sells a patented article

and fails to mark in accordance with § 287, the patentee cannot

collect damages until it either begins providing notice or sues

the alleged infringer — the ultimate form of notice — and then

only for the period after notification or suit has occurred.”

Arctic Cat Inc. v. Bombardier Recreational Prods. Inc., 950 F.3d

860, 864 (Fed. Cir.), cert. dismissed, ____ U.S. ____, 141

S. Ct. 753 2020).

At no point do Defendants allege that Plaintiff failed to

mark its products. In fact, Plaintiff maintains that all

relevant products were marked by both Plaintiff and its

licensee, (Pl.’s Resp. (Doc. 154) at 7), and no facts are

presented to the contrary. Defendants instead allege Plaintiff

has failed to present evidence demonstrating that “both that its

licensee’s products were continuously marked and that it made

reasonable efforts to ensure its licensee’s compliance with

§ 287(a).” (Defs.’ Reply (Doc. 167) at 14.)

Defendants are correct that “[t]he burden of proving

compliance with marking is and at all times remains on the

patentee.” Arctic Cat Inc. v. Bombardier Recreational Prods.

Inc., 876 F.3d 1350, 1367 (Fed. Cir. 2017). However, “an alleged

infringer who challenges the patentee’s compliance with § 287

bears an initial burden of production to articulate the products

it believes are unmarked ‘patented articles’ subject to § 287.”

Id. at 1368. In other words, before a plaintiff bears the burden

to present evidence of marking, the defendants “shoulder[] only

a burden of production to identify unmarked products that [they]

allege[] should have been marked.” Id. at 1369 (emphasis added).

Though this bar is low, at no point do Defendants meet it: they

fail to actually allege that any products were unmarked. The

purpose of this rule is to prevent “gamesmanship” - which

appears to be Defendants’ strategy by carefully avoiding the

allegation that any relevant products were, in fact, unmarked.

Id. at 1368. The court will not prohibit pre-action damages on

this ground at summary judgment, as Plaintiff maintains all

relevant products are marked and Defendants have not properly

challenged Plaintiff’s compliance with § 287.

b. Actual Notice

Defendants also seek summary judgment preventing pre-action

damages on the basis that Plaintiff “is not entitled to any

damages for sales of the accused products prior to the date

Plaintiff first provided written notice of its infringement

allegations.” (Doc. 142.) Plaintiff argues that Defendants were

on notice because of Man Wah I, which involved similar

infringement allegations regarding the same patents. Plaintiff

argues that Man Wah I served to put Defendants on notice about

potential infringement for the products at issue in the present

case, in addition to the specific products covered in that

action. Indeed, “[i]f a patentee’s initial notice is

sufficiently specific to accuse one product of infringement,

‘ensuing discovery of other models and related products may

bring those products within the scope of the notice.’” K-TEC,

Inc. v. Vita-Mix Corp., 696 F.3d 1364, 1379 (Fed. Cir. 2012)

(quoting Funai Elec. Co. v. Daewoo Elecs. Corp., 616 F. 3d 1357,

1373 (Fed. Cir. 2010); see also Iron Oak Techs., LLC v. Fujitsu

Am., Inc., No. 3:16-cv-3319-M, 2018 WL 6593709, at *3 (N.D. Tex.

Dec. 14, 2018) (“[O]nce a patentee provides notice of

infringement with respect to one product, other models and

related products may be found to be within the scope of the

notice.”).

The parties here disagree whether the initial action dealt

with infringement that was sufficiently similar to the

currently-alleged infringement such that notice was provided at

the time of that case. The court’s role here is the same as that

on the question of claim preclusion similarity to Man Wah I. See

discussion infra III.A.2.c. Given the factual dispute on this

issue, and the high standard of summary judgment, this court is

not in a position to rule that no reasonable jury could find

adequate notice existed: this question comes down to the level

of similarity of the products, which is ultimately an issue of

fact. See MLC Intell. Prop., LLC v. Micron Tech., Inc., Case No.

19-cv-03345-EMC, 2019 WL 4963253, at *10 (N.D. Cal. Oct. 8,

2019) (“Nevertheless, at this early juncture in the litigation,

the Court cannot [come to a conclusion] as a matter of law

. . . . [W]hether the [new] products are sufficiently similar

for notice purposes is a question of fact for the jury to

decide.”); Novo Nordisk A/S v. Becton Dickinson & Co., 96

F. Supp. 2d 309, 320 (S.D.N.Y. 2000) (“Even where the notice

given went to a merely related product class, such notice may be

sufficient and the question of adequate notice must go to the

jury.”).

D. Reasonableness of Royalties

Defendants next allege that Plaintiff “cannot meet its

burden of providing a reasonable royalty because Mr. Rogers’s

reasonable royalty analysis is unreliable and based on ‘mere

speculation or guess.’” (Defs.’ Br. (Doc. 143) at 29.) First and

foremost, as with many of the issues raised in these summary

judgment motions, the credibility of expert testimony is

fundamentally a question for the factfinder. The Federal Circuit

has made clear that “[t]he degree of comparability [between two]

license agreements as well as any failure on the part of [the]

expert to control for certain variables are factual issues best

addressed by cross examination and not by exclusion.”

ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc., 694 F.3d

1312, 1333 (Fed. Cir. 2012). See also i4i Ltd. P’ship v.

Microsoft Corp., 598 F.3d 831, 856 (Fed. Cir. 2010)

(“[Q]uestions about what facts are most relevant or reliable to

calculating a reasonable royalty are for the jury.”).

Moreover, Mr. Rogers’ opinion, regardless of its

credibility, does not appear to be based on mere “guess” as

Defendants argue – he provides substantial analysis explaining

his calculations, including an adjustment for non-exclusivity

that affects the upfront payment. (Doc. 144-20 at 53.) The

starting point of Mr. Rogers’ analysis is the license with

Leggett & Platt, which Defendants contest is an inappropriate

comparator. (Defs.’ Br. (Doc. 143) at 29.) Certainly, “[w]hen

relying on licenses to prove a reasonable royalty, alleging a

loose or vague comparability between different technologies or

licenses does not suffice.” LaserDynamics, Inc. v. Quanta

Computer, Inc., 694 F.3d 51, 79 (Fed. Cir. 2012). However, Mr.

Rogers attests that he “searched the publicly available, fee-

based, RoyaltySource® database in an effort to identify

agreements relating to technology most similar to the Patents-

in-Suit” and ultimately concluded that Leggett & Platt was the

best comparator, in spite of its larger size, because

“Defendants and Leggett & Platt are similar types of companies .

. . and compete against each other in domestic and international

markets.” (Doc. 144-20 at 17-18.) It was also Mr. Rogers’ expert

opinion that “the Leggett & Platt License Agreement establishes

Ultra-Mek’s desired licensing format that follow-on licensees,

if any, would be pressed to accept.” (Id. at 27.) Plaintiff

notes that Defendants have failed to provide any expert

testimony to counter Mr. Rogers’ approach to assessing what

royalties and upfront payment may be appropriate. (Pl.’s Resp.

(Doc. 154) at 30.) Of course, the lack of an expert alone does

not disqualify Defendants’ argument. See, e.g., ResQNet.com,

Inc. v. Lansa, Inc., 594 F.3d 860, 872 (Fed. Cir. 2010) (“This

court should not sustain a royalty award based on inapposite

licenses simply because [the defendant] did not proffer an

expert to rebut [the other party’s expert].”). However, the

analysis provided by Mr. Rogers clearly goes beyond a “loose . .

. comparability” to Leggett & Platt. LaserDynamics, Inc., 694

F.3d at 79. The license with Leggett & Platt, according to Mr.

Rogers, bears substantial similarities to a theoretical license

with Defendants – the companies are direct competitors, and the

greater market size of Leggett & Platt was noted and allegedly

taken into account by Mr. Rogers’ report. Beyond the basic

similarity presented here, further interrogation of the

similarity of the licenses is best left to the factfinder.

E. Liability of Man Wah (USA)

Finally, Defendants seek summary judgment dismissing Man

Wah (USA) from the case “as there is no evidence that Man Wah

(USA) made, used, offered for sale, or sold any of the accused

products.” (Doc. 142.) Plaintiff’s Complaint, (Am. Compl (Doc.

31)), alleges that “Man Wah Holdings, RMT, Man Wah (USA), and

other companies are effectively operating as a single entity

known as the ‘Man Wah Group.’” (Id. ¶ 11.)

Regarding Counts I and II, the infringement counts,

Plaintiff’s Final Disclosure of Asserted Claims and Infringement

Contentions includes the allegation that certain Defendants,

while they may not have directly sold the Accused Products,

still contributed to that infringement. (Doc. 136-18 at 3.)

Plaintiff argues that Defendants were either selling the

products themselves or “inducing or contributing others to

manufacture, use, sell, and/or offer for sale in the United

States and/or importing into the United States” the Accused

Products. (Id. at 4.) In this vein, Plaintiff has amply alleged

the overlapping business structure of Man Wah (USA) and the

other Man Wah entities. Plaintiff also alleges that Man Wah

(USA) “arranges” the sale of furniture for other Man Wah

corporations, though further evidence of that has not been

placed on the record in this case. (Pl.’s Resp. (Doc. 154) at

32.) A reasonable jury could find evidence that Man Wah (USA)

indirectly infringed the patents at issue by, at the very least,

contributing to others offering the products for sale in the

United States.

Counts III and IV, which deal with the alleged breach of

the Settlement Agreement, allege that Man Wah (USA) “promised in

the March 2017 settlement agreement that [it] and none of [its]

affiliates” would infringe again, yet Man Wah Holdings and

affiliates in fact “carried out such actions” as alleged in this

complaint. (Am. Compl. (Doc. 31) ¶ 91.) Plaintiff also argues

that Man Wah (USA) participated directly in “substantive

business functions” and “decision-making” for Man Wah Holdings

due to its “overlapping ownership and business functions.”

(Pl.’s Resp. (Doc. 154) at 32.) The record demonstrates that the

CEO of Man Wah (USA), William Guy Ray (“Mr. Ray”), had full

authority to settle on behalf of the entire Man Wah

organization, which included all Defendants except UFI. (Doc.

107 at 3, 5.) Moreover, as the CEO of Man Wah (USA), Mr. Ray has

openly stated he is “actively involved in” everything from

“developing global strategies” to “decisions about new

products.” (Doc. 108 at 1-2.) Mr. Ray also indicates that these

decisions are made “[f]or the entire Man Wah organization

worldwide.” (Id. at 1.) Summary judgment is not appropriate

here, as a reasonable jury could disagree with Defendants that

“Man Wah (USA) was not involved in the sales of the Accused

Products”, (Defs.’ Br. (Doc. 143) at 31), due to its overlapping

business functions with Man Wah Holdings, as well as the

extensive control its CEO possessed over the products released

by the broader Man Wah organization.

Iv. CONCLUSION

For the reasons set forth herein,

IT IS THEREFORE ORDERED that Defendants’ Motion for Summary

Judgment, (Doc. 142), is DENIED.

IT IS FURTHER ORDERED that Plaintiff’s Motion for Summary

Judgment, (Doc. 134), is DENIED.

This the 30th day of March, 2021.

*

LS Wi un L. Maher.

United States District Jud

=- 40 =-