Reported / Citable
Background
After the Artificial Intelligence Industry Association and Artificial Intelligence Imaging Association (collectively, AIIA) demanded that Plus One Robotics remove products from the market or obtain a license for allegedly patented technology, Plus One filed this declaratory-judgment action seeking findings of noninfringement. AIIA counterclaimed for infringement of five patents, as well as fraud on the court, defamation, and business disparagement under Texas law.
Plus One moved to dismiss the three non-patent counterclaims and to strike seven of AIIA’s eight asserted affirmative defenses. The challenged claims rested largely on statements in Plus One’s complaint and on an alleged inconsistency between Plus One’s denial of using synthetic-image datasets and a 2022 statement attributed to its CTO.
The Court’s Holding
Magistrate Judge Henry J. Bemporad recommended granting the motion in part. He recommended dismissing with prejudice AIIA’s defamation and business-disparagement counterclaims because the statements at issue appeared in Plus One’s pleading and were therefore absolutely privileged as communications made in the course of a judicial proceeding. Foreseeable media coverage of the complaint did not remove that privilege.
The magistrate judge also recommended dismissing the fraud-on-the-court counterclaim with prejudice. Fraud on the court is not an independent damages claim; it is a basis to seek relief from a judgment or order, and no judgment existed here. In any event, the alleged conflict between Plus One’s current pleading and its CTO’s years-old public statement did not approach the egregious misconduct required for Rule 60(d) fraud on the court.
The recommendation would strike six purported affirmative defenses: failure to state a claim and lack of subject-matter jurisdiction, to the extent mislabeled as affirmative defenses; judicial estoppel; waiver; a purported pattern of willful infringement; and an objection concerning settlement discussions. It would leave AIIA’s unclean-hands defense in place at this stage.
Key Takeaways
- Texas’s judicial-proceedings privilege bars defamation and business-disparagement claims based on allegations in a live court pleading.
- Fraud on the court is not a standalone claim for damages and requires far more than an asserted inconsistency in litigation positions.
- An unclean-hands defense survived because AIIA alleged an asserted conflict between Plus One’s litigation position and a prior public statement, although unrelated patent litigation could not support that defense.
Why It Matters
The recommendation underscores the broad protection afforded to statements made in pleadings, even when those pleadings receive press coverage. Parties disputing allegations in court filings generally must respond through the litigation process rather than tort counterclaims.
It also illustrates the limited role of Rule 12(f): defenses that are legally improper or merely evidentiary objections may be stricken, but a potentially viable equitable defense will ordinarily remain when the movant cannot meet the rule’s demanding standard.