On January 25, 2018, United States District Judge Alvin K. Hellerstein (S.D.N.Y.) denied plaintiff Serta Simmons Bedding, LLC’s (“Serta”) motion to dismiss defendant Casper Sleep Inc.’s (“Casper”) counterclaim and affirmative defense.

Serta sued Casper on September 29, 2017, alleging that Casper’s “Wave” mattress infringed Serta’s U.S. Patents Nos. 7,424,763, 7,036,173, and 8,918,935. On November 17, 2017, Casper filed a counterclaim and affirmative defense alleging that Serta engaged in inequitable conduct by withholding two prior art references during prosecution of the asserted patents. Specifically, Casper alleged that the inventor of the three asserted patents and his attorney knew of the prior art because: (i) they had disclosed the first prior art while prosecuting a prior patent application and (ii) the second prior art was identified to them during their prosecution of another prior patent application. Serta moved to dismiss Casper’s counterclaim and affirmative defense for failure to satisfy Rule 9(b)’s heightened pleading standard for inequitable conduct.

Judge Hellerstein denied Serta’s motion, holding that Casper had sufficiently alleged facts underlying its claim. Judge Hellerstein explained that a claim of inequitable conduct must allege that “‘a specific individual (1) knew of the withheld material information . . . , and (2) withheld or misrepresented this information with a specific intent to deceive the PTO.’” (quoting Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312, 1328-29 (Fed. Cir. 2009)). Casper’s allegations that the inventor and his attorney had prior knowledge of the specific prior art references from a specific source, and that the prior art was material to particular claims in the asserted patents, was sufficient.

Case: Serta Simmons Bedding, LLC v. Casper Sleep Inc., No. 17-CV-7468 (AKH), Dkt. No. 80 (S.D.N.Y. Jan. 25, 2018).