Attorneys for Defendant NEST LABS, INC.
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA
E.DIGITAL CORPORATION,
Plaintiff,
v.
NEST LABS, INC.,
Defendant.
Case No. 3:16-cv-00375-JST
DEFENDANT NEST LABS, INC.’S ANSWER TO COMPLAINT FOR PATENT INFRINGEMENT
Defendant Nest Labs, Inc. (“Nest”) hereby answers Plaintiff e.Digital Corporation’s (“e.Digital”) Complaint for Patent Infringement (“Complaint”), on personal knowledge as to its own activities and on information and belief as to the activities of others, as follows:
NATURE OF THE ACTION
1. Nest admits that the Complaint purports to state a cause of action arising under the patent laws of the United States, Title 35 of the United States Code, and that e.Digital purports to seek a preliminary and permanent injunction and monetary damages for the alleged infringement of U.S. Patent Nos. 9,002,331 and 9,178,983. Except as expressly admitted, Nest denies the allegations contained in paragraph 1 of the Complaint.

2. Nest admits that this Court has subject matter jurisdiction over this case for patent infringement pursuant to 28 U.S.C. §§ 1331 and 1338(a).
3. Nest admits that venue is proper in the Northern District of California pursuant to 28 U.S.C. §§ 1391(b) and 1400(b). Nest admits that it has a principal place of business in the Northern District of California. Except as expressly admitted, Nest denies the allegations contained in paragraph 3 of the Complaint.
4. Nest does not contest personal jurisdiction in the Northern District of California. Nest admits that it has a principal place of business at 3400 Hillview Ave., Palo Alto, California 94304. Nest admits that certain products are offered for sale at Home Depot and Best Buy retail stores within the Northern District of California. Nest admits that certain products are offered for sale at its website https://store.nest.com. Except as expressly admitted, Nest denies the allegations contained in paragraph 4 of the Complaint.
PARTIES
5. Nest lacks knowledge or information sufficient to form a belief as to the truth of the allegations contained in paragraph 5 of the Complaint, and on that basis denies them.
6. Nest admits that it is a corporation organized and existing under the laws of the State of Delaware, and has a principal place of business at 3400 Hillview Ave., Palo Alto, California 94304. Except as expressly admitted, Nest denies the allegations contained in paragraph 6 of the Complaint.
THE ACCUSED PRODUCTS
7. Nest admits that the Complaint purports to allege that the “accused products for purposes of the asserted patents include but are not limited to sensor-based products and services, such as, without limitation, Defendant’s remote monitoring systems, including remote sensors, servers and mobile applications sold as ‘Nest’ branded products and services.” Nest admits that Dropcam, Inc. is a wholly-owned subsidiary of Nest. Nest denies e.Digital’s allegations that the accused products work in conjunction with mobile applications marketed, sold and/or distributed by Dropcam, Inc., and further denies that based on e.Digital’s foregoing allegations that Nest directs or controls the activities of Dropcam, Inc. or otherwise engages in a Case 3:16-
joint enterprise with Dropcam, Inc. with respect to the purported accused products. Except as expressly admitted, Nest denies the allegations contained in paragraph 7 of the Complaint.
THE ASSERTED PATENTS
8. Nest admits that Exhibit A to the Complaint purports to be a copy of U.S. Patent No. 9,002,331 (“the ’331 patent”). Nest further admits that, on its face, the ’331 patent is entitled “System and Method for Managing Mobile Communications,” has an issue date of April 7, 2015, and lists Patrick Nunally as named inventor. Nest lacks knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 8 of the Complaint, and on that basis denies them.
9. Nest admits that Exhibit B to the Complaint purports to be a copy of U.S. Patent No. 9,178,983 (“the ’983 patent”). Nest further admits that, on its face, the ’983 patent is entitled “System and Method of Managing Mobile Communications,” has an issue date of November 3, 2015, and lists Patrick Nunally as named inventor. Nest lacks knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 9 of the Complaint, and on that basis denies them.
ANSWER TO COUNT ONE ALLEGED INFRINGEMENT OF THE ’331 PATENT
10. Nest incorporates and realleges paragraphs 1-9 of its Answer as if fully set forth herein in response to the allegations contained in paragraph 10 of the Complaint.
11. Nest denies the allegations contained in paragraph 11 of the Complaint.
12. Nest denies the allegations contained in paragraph 12 of the Complaint.
13. Nest denies the allegations contained in paragraph 13 of the Complaint.
14. Nest denies the allegations contained in paragraph 14 of the Complaint.
15. Nest denies the allegations contained in paragraph 15 of the Complaint.
16. Nest denies the allegations contained in paragraph 16 of the Complaint.
17. Nest denies the allegations contained in paragraph 17 of the Complaint.
18. Nest denies the allegations contained in paragraph 18 of the Complaint.
19. Nest denies the allegations contained in paragraph 19 of the Complaint. Case 3:16-cv-00375-JST
20. Nest admits that it generally provides information on how to purchase the “Nest Aware” service. Except as expressly admitted, Nest denies the allegations contained in paragraph 20 of the Complaint.
21. Nest denies the allegations contained in paragraph 21 of the Complaint.
22. Nest denies the allegations contained in paragraph 22 of the Complaint.
ANSWER TO COUNT TWO ALLEGED INFRINGEMENT OF THE ’983 PATENT
23. Nest incorporates and realleges paragraphs 1-22 of its Answer as if fully set forth herein in response to the allegations contained in paragraph 23 of the Complaint.
24. Nest denies the allegations contained in paragraph 24 of the Complaint.
25. Nest denies the allegations contained in paragraph 25 of the Complaint.
26. Nest denies the allegations contained in paragraph 26 of the Complaint.
27. Nest denies the allegations contained in paragraph 27 of the Complaint.
28. Nest denies the allegations contained in paragraph 28 of the Complaint.
29. Nest denies the allegations contained in paragraph 29 of the Complaint.
30. Nest denies the allegations contained in paragraph 30 of the Complaint.
31. Nest denies the allegations contained in paragraph 31 of the Complaint.
32. Nest denies the allegations contained in paragraph 32 of the Complaint.
33. Nest admits that it generally provides information on how to purchase the “Nest Aware” service. Except as expressly admitted, Nest denies the allegations contained in paragraph 33 of the Complaint.
34. Nest denies the allegations contained in paragraph 34 of the Complaint.
35. Nest denies the allegations contained in paragraph 35 of the Complaint.
PRAYER FOR RELIEF
Paragraphs 1-6 set forth the statement of relief requested by e.Digital to which no re-sponse is required. To the extent a response is required, Nest denies any and all allegations contained in the remainder of the Complaint and denies that e.Digital is entitled to any of the relief requested in paragraphs 1-6 of its prayer for relief or to any other relief in any form

whatsoever. Nest further denies each and every allegation contained in the Complaint to which it has not specifically responded.
DEMAND FOR JURY TRIAL
e.Digital’s demand for a jury trial does not state any allegation against Nest to which a response is required. To the extent that any allegations are included in the demand, Nest denies such allegations.
DEFENSES
Subject to the foregoing responses, Nest alleges and asserts the following defenses in response to the allegations, undertaking the burden of proof only as to those defenses deemed affirmative defenses by law, regardless of how such defenses are denominated herein. In addition to the defenses described below, Nest specifically reserves all rights to allege additional defenses that become known through the course of discovery.
FIRST DEFENSE
36. e.Digital’s Complaint fails to state a claim upon which relief may be granted.
SECOND DEFENSE
37. Nest has not infringed, contributed to the infringement of, or induced others to infringe, any claim of the ’331 and/or ’983 patents, directly or indirectly, literally or by equivalents, at least because the accused Nest products do not store “a social hierarchy . . . wherein the social hierarchy comprises differing levels of operations to be performed based on social levels and the user’s activity classification.” In addition, to the extent that e.Digital alleges that Nest indirectly infringes the ’331 and/or ’983 patents, Nest has at all relevant times believed in good faith that the use of the accused Nest products does not infringe any claim of the ’331 and/or ’983 patents, and that the asserted claims of the ’331 and/or ’983 patents are invalid thus negating at least the “specific intent” element of such claims. To the extent that e.Digital alleges that Nest contributes to the infringement of the ’331 and/or ’983 patents, these claims are further barred in whole or in part under 35 U.S.C. § 271(c) in view of the substantial non-infringing uses of Nest’s alleged infringing products. Nest has engaged in all relevant activities in good faith, thereby precluding e.Digital, even if it were to prevail, from recovering enhanced damages for willful infringement under 35 U.S.C. § 284 or recovering its attorneys’ fees and/or costs under 35 U.S.C. § 285. In addition, to the extent that e.Digital does not allege that Nest performs every limitation of the ’331 and/or ’983 patents, Nest has not infringed, contributed to the infringement of, or induced others to infringe, any claim of the ’331 and/or ’983 patents, directly or indirectly, literally or by equivalents, at least because Nest products do not work in conjunction with third party mobile applications and because Nest does not exercise direction or control over a third party that performs any limitations of the ’331 and/or ’983 patents.
THIRD DEFENSE
38. The claims of the ’331 and/or ’983 patents are invalid for failure to comply with one or more of the requirements of 35 U.S.C. §§ 101, 102, 103, and/or 112. Upon information and belief, the ’331 and/or ’983 patents are invalid in view of, for example, U.S. Patent No. 7,831,679 entitled “Guiding Sensing And Preferences For Context-Sensitive Services,” which was filed on June 29, 2005 and issued on November 9, 2010.
FOURTH DEFENSE
39. By reason of proceedings in the United States Patent and Trademark Office, and by reasons of amendments, disclaimers, disavowals, admissions, representations, arguments, and/or statements made by the applicants or on their behalf, e.Digital is estopped from construing the claims of the ’331 and/or ’983 patents to cover and/or include any acts of Nest.
FIFTH DEFENSE
40. Nest is informed and believes, and thereon alleges, that e.Digital may not claim pre-lawsuit damages, in whole or in part, for failure to comply with 35 U.S.C. § 287.
SIXTH DEFENSE
41. e.Digital’s claims for relief and prayer for damages are barred by the equitable doctrines of laches, waiver, and/or estoppel.
SEVENTH DEFENSE
42. e.Digital has failed to state facts and/or a legal basis sufficient to permit the Court to grant equitable or injunctive relief against Nest.
Nest reserves all defenses under the Federal Rules of Civil Procedure, the Patent Laws of the United States, and any other defenses, at law or in equity, that may now exist or in the future be available based on discovery and further factual investigation in this case.
Dated: March 21, 2016 WILSON SONSINI GOODRICH & ROSATI Professional Corporation
By:
Stefani E. Shanberg
Attorneys for Defendant NEST LABS, INC.