Context: Last spring, Samsung launched a pre-emptive strike against notoriously litigous smart ring maker Oura (which likes to spell its name as ŌURA) in the United States District Court for the Northern District of California (May 31, 2024 ip fray article). Samsung wanted to shield the Galaxy Ring, which it was then preparing for launch (June 29, 2024 ip fray article), by means of declaratory judgment (DJ) on the non-infringement of five patents. Oura moved to dismiss Samsung’s DJ complaint (June 14, 2024 ip fray article) on the basis that there had been no explicit and specific threat to assert patents againt the then-forthcoming Galaxy Ring.
What’s new: Judge Araceli Martínez-Olguín has just granted Oura’s motion and dismissed Samsung’s complaint, but without prejudice, meaning that Samsung may file an amended complaint until April 25, 2025. However, the amended complaint in this case would have to be limited to allegations that predate the filing of the original complaint.
Direct impact: The decision comes as no surprise, and a deep-pocketed player like Samsung can spend money on a defensive measure even if it goes nowhere. Here, the DJ complaint is just about venue. The Northern District of California is preferred by defendants to patent infringement actions over virtually any other district in the United States, and if Oura had brought or still brought a patent infringement lawsuit against Samsung, it would presumably do so in the Eastern District of Texas, a district in which Samsung has a substantial presence. Samsung just wanted to create a situation in which it could try to move any Oura lawsuit from Texas to California (where Samsung started the dispute), or in which Oura would at least have to await the dismissal of the DJ action in order to then be in a stronger position to keep a lawsuit of its own in Texas. While it is hard to see how Samsung can meet the requirements for a DJ complaint now, given that Judge Martínez-Olguín stated clearly that any allegations would have to go back to the time before the complaint, Samsung might give it a try just to delay the resolution of the DJ action.
Wider ramifications: Smart rings are a category of wearable digital devices that has recently seen tremendous growth. A few months ago, Oura raised $200 million in capital from Fidelity and medical device maker Dexcom at a $5 billion valuation (December 19, 2024 press release by Oura).
Here is the order granting, without prejudice, Oura’s motion to dismiss Samsung’s DJ complaint:
The decision came down without a hearing as the facts were clear enough in their own right.
The case had been narrowed from five to three patents along the way. In parallel inter partes review proceedings, Oura filed statutory disclaimers of all claims of those two patents (the ‘179 and ‘833 patents). That is an example of how Samsung benefits from any delay.
The court’s analysis is relatively short. There was no explicit threat by Oura to sue Samsung over any particular patents. In public statements, Oura executives had merely reserved the right to take a look at the Galaxy Ring upon its launch, and to form an opinion then on whether there is an infringement.
The fact that Oura had previously sued others was not considered a sufficient basis for a DJ action by Samsung. If anything, it was just a circumstance that could be considered as part of a holistic analysis.
Motions to dismiss can be based on facial (where all factual allegations in the complaint are taken as true) and factual (where those facts are disproven) grounds. Oura argued on a facial basis with a factual fallback, and the fallback was never reached because Judge Martínez-Olguín found Samsung’s complaint facially ripe for dismissal. In order for the court to have jurisdiction over a DJ action, there must be an actual controversy, and whatever Samsung alleged Oura had said or done fell short of what constitutes one.
It is hard to imagine that any “smoking gun” of an actual controversy existed when Samsung filed its original complaint, but was not raised in that complaint. Samsung obviously planned this litigation strategically (which presumably means they knew they were most likely going to lose this one, but it could still serve a useful purpose). It’s not like Samsung held back any facts that it could now leverage in an amended complaint.
Maybe Samsung will give it another try, just because it has the resources to cause further delay. But Samsung will have to think about how an amended complaint that adds nothing of substance would be viewed by the court.
A final dismissal can be appealed. Samsung might do so just because it can then still make an argument in favor of litigating any actual infringement claims by Oura in the Northern District of California. It would argue that in the event of a successful appeal, the DJ action will be resumed in the Northern District of California. But that would be a weaker argument than having an actual (and not dismissed) case pending in another district court.
Given that Judge Martínez-Olguín found this case to be so clear-cut that she didn’t need a hearing, and which enabled her to order its dismissal on only 10 pages, Samsung would not have a strong argument concerning judicial economy if it wanted to move a hypothetical infringement action by Oura out of the Eastern District of Texas.
Even if Oura sued now, it would not prove that there was an actual controversy at the time of the original DJ complaint.
Theoretically, Samsung could also bring a new DJ complaint, but only if there were new facts. The mere fact that it carried on with its Galaxy Ring project is not sufficient. Oura would have had to say or do something that would allow Samsung to claim that an actual controversy has meanwhile arisen. That is doubtful.
Today’s dismissal of Samsung’s DJ action is probably not the beginning of the end of this smart ring patent dispute, but merely the end of its beginning.
Counsel
Samsung is represented by O’Melveny & Myers lawyers from three different offices:
- Los Angeles: Ryan Yagura.
- New York: Marc Pensabene and Joanne Bae.
- San Francisco: Mark Liang, Bill Trac and Sorin Zaharia.
Oura is represented by Arentfox Schiff lawyers from two cities:
- San Francisco: Janine Carlan.
- Washington, D.C.: Jasjit Vidwan.