After that analysis, the district court determined that it would join the majority of “district courts in the Ninth Circuit in finding that allegations of knowledge alone are not sufficient to state a claim for willful infringement. See XpertUniverse, Inc. v. Cisco Sys., Inc., No. 17-cv-03848-RS, 2017 WL 4551519, at *6 (N.D. Cal. Oct. 11, 2017) (“Although [plaintiff] has alleged knowledge and continued infringement, it needs to do more to show that [defendant] has engaged in ‘egregious cases of misconduct beyond typical infringement’ that could possibly warrant enhanced damages.” (quoting Halo, 136 S. Ct. at 1935)); Cont’l Circuits, 2017 WL 2651709, at *8 (“The Court continues to conclude that willfulness must be pled, and that allegations of knowledge alone are insufficient.”); Finjan, Inc. v. Cisco Sys. Inc., No. 17-cv-00072-BLF, 2017 WL 2462423, at *5 (N.D. Cal. June 7, 2017) (“[E]ven if [plaintiff] had adequately alleged that [defendant] had pre-suit knowledge of the Asserted Patents, dismissal would also be warranted because the FAC does not contain sufficient factual allegations to make it plausible that [defendant] engaged in ‘egregious’ conduct that would warrant enhanced damages under Halo.”).

Following that reasoning, the district court reviewed DSS’ allegations and found that they were insufficient to state a claim for willful infringement. “The Court finds that DSS’s allegations are not sufficient to state a claim for willful infringement of the patents-in-suit. Although, DSS has alleged knowledge and continued infringement, it has failed to allege facts suggesting that Lite-On’s conduct amounts to an “egregious case[] of misconduct beyond typical infringement.” Halo, 136 S. Ct. at 1935. “Disagreement about the existence of continued infringement does not necessarily indicate willful or deliberate misconduct.” XpertUniverse, 2017 WL 4551519, at *6. Thus, without more, the facts as alleged do not support a plausible inference that Lite-On’s conduct warrants enhanced damages under Halo and § 284.”

As a result, the district court granted Lite-On’s motion to dismiss the claims of willful infringement.

Document Security Systems, Inc. v. Lite-On, Inc., et al., Case No. CV 17-06050 JVS (JCGx) (C.D. Cal. February 5, 2018)