Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 1 of 9 PageID #: 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF TEXAS MARSHALL DIVISION

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1 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 1 of 9 PageID #: 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF TEXAS MARSHALL DIVISION TRAXXAS LP, v. Plaintiff, HOBBY PRODUCTS INTERNATIONAL, INC. d/b/a HPI RACING and HOBBY PRODUCTS INTERNATIONAL EUROPE LTD., Defendants. Civil Action No. 2:15-cv-1267 JURY TRIAL DEMANDED COMPLAINT FOR PATENT INFRINGEMENT Plaintiff Traxxas LP ( Plaintiff or Traxxas ) files this Original Complaint for Patent Infringement ( Complaint ) seeking injunctive and compensatory relief against Defendants Hobby Products International, Inc. d/b/a HPI Racing ( HPI Racing ) and Hobby Products International Europe Ltd. ( HPI Europe ) (collectively, HPI ) for infringement of U.S. Patent Nos. 8,976,511 (the 511 Patent ) and 8,982,541 (the 541 Patent ) (collectively, the Patentsin-Suit ). In support of its Complaint, Traxxas shows as follows: PARTIES 1. Traxxas, LP is a Texas-based company that designs, develops and sells hobbyclass remote-controlled vehicles. 2. Upon information and belief, HPI Racing is a corporation organized under the laws of the State of California that does business in the State of Texas. HPI Racing may be served with process by serving its registered agent, Tatsuro Watanabe, at HPI Racing s principal place of business, which is located at 70 Icon Street, Foothill Ranch, California 92610, or 1

2 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 2 of 9 PageID #: 2 wherever else he may be found, with citation attached, or by certified mail, return receipt requested. 3. Upon information and belief, HPI Europe is a company organized under the laws of the United Kingdom that does business, directly or through intermediaries, in the State of Texas. Under the Convention of 15 November 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, HPI Europe may be served with process by transmitting this Complaint and all exhibits thereto, in duplicate, along with a Request for Service Abroad of Judicial or Extrajudicial Documents, to the Central Authority for the United Kingdom: The Senior Master, For the attention of the Foreign Process Section, Room E16, Royal Courts of Justice, Strand, London WC2A 2LL, United Kingdom. JURISDICTION AND VENUE 4. This action arises under the patent laws of the United States, 35 U.S.C. 101 et seq. This Court has original and exclusive jurisdiction over the subject matter of the Complaint pursuant to 28 U.S.C and 1338(a). 5. This Court has personal jurisdiction over each Defendant in that each Defendant, directly or through intermediaries, has committed acts within Texas and the Eastern District of Texas giving rise to this action. As set forth in this Complaint, each Defendant, directly or through intermediaries, has purposely transacted business involving its accused products in this judicial district by providing products for sale through online and hobby-store distributors in the State of Texas and Eastern District of Texas. 6. Venue is proper in this district pursuant to 28 U.S.C. 1391(b)-(c) and 1400(b) because each Defendant, directly or through intermediaries, does business in this judicial district and has committed acts giving rise to this action within this district. 2

3 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 3 of 9 PageID #: 3 FACTUAL ALLEGATIONS 7. The 511 Patent, entitled Protective Enclosure for Model Vehicle, was duly and legally issued by the United States Patent and Trademark Office on March 10, 2015, after full and fair examination. A copy of the 511 Patent is attached hereto as Exhibit A. 8. The 511 Patent provides for a protective enclosure that may be configured for use in a remotely controllable model vehicle to protect a control module. 9. Traxxas has owned the 511 Patent throughout the period of HPI s infringing acts and still owns the patent. Traxxas is the sole owner of all rights, title, and interest in the 511 Patent and possesses all rights of recovery, including the right to recover all past damages, under the 511 Patent. 10. The 541 Patent, entitled Protective Enclosure for Model Vehicle, was duly and legally issued by the United States Patent and Trademark Office on March 17, 2015, after full and fair examination. A copy of the 541 Patent is attached hereto as Exhibit B. 11. The 541 Patent provides for a protective enclosure that may be configured for use in a remotely controllable model vehicle to protect a control module. 12. Traxxas has owned the 541 Patent throughout the period of HPI s infringing acts and still owns the patent. Traxxas is the sole owner of all rights, title, and interest in the 541 Patent and possesses all rights of recovery, including the right to recover all past damages, under the 541 Patent. 13. On information and belief, HPI manufactures radio control cars, trucks, and monster trucks. HPI offers gas off-road, nitro off-road, electric off-road, nitro on-road, electric on-road, and precision diecast cars and trucks, as well as various parts and accessories, such as bodies, tires, wheels, motors and engines, option parts, gear parts, and various other parts. HPI 3

4 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 4 of 9 PageID #: 4 also provides electric- and nitro-powered car and truck kits. HPI, directly or through intermediaries, offers for sale and sells its products through a network of dealers in the United States. 14. HPI, directly or through intermediaries, does business through the website and its products can be purchased at hobby stores within the Eastern District of Texas. 15. HPI, directly or through intermediaries, ships, distributes, offers for sale, sells, and advertises its accused products in the United States, including within the State of Texas and the Eastern District of Texas. 16. Specifically, HPI, directly or through intermediaries, ships, distributes, offers for sale, sells, and advertises protective enclosures, including those marketed as waterproof enclosures, that infringe, literally or under the doctrine of equivalents, the claims of the 511 Patent and the 541 Patent. 17. Upon information and belief, HPI, directly or through intermediaries, has sold the accused protective enclosures to customers located in the Eastern District of Texas. CAUSES OF ACTION COUNT I INFRINGEMENT OF U.S. PATENT NO. 8,976, Traxxas realleges and incorporates by reference paragraphs 1-17 above as if fully set forth herein. 19. In violation of 35 U.S.C. 271(a), HPI has directly infringed, literally or under the doctrine of equivalents, and continues to directly infringe one or more claims of the 511 Patent by making, using, selling, or offering for sale in the United States, or by importing into the United States, protective enclosures that embody the invention claimed in the 511 Patent. 4

5 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 5 of 9 PageID #: HPI manufactures and sells remote-control model vehicles that include protective enclosures to protect the radio control receivers in such vehicles. For example, HPI sells and offers for sale in the United States at least the following remote-controllable vehicle products, which include protective enclosures that infringe the 511 Patent, either literally or under the doctrine of equivalents: a. RTR Bullet ST 3.0; b. RTR Bullet MT 3.0; c. Desert Trophy; d. RTR Blitz w/ 2.4GHz; e. RTR E-Firestorm 10T 2.4GHz; f. RTR E-Firestorm 10T Flux; g. Sprint 2 Sport RTR with Nissan GT-R; h. Sprint 2 Sport RTR w/ 1969 Chevrolet Camaro; i. RTR Sprint 2 Sport; j. Sprint 2 Drift RTR w/ 2010 Chevrolet Camaro; k. Sprint 2 Drift RTR with Nissan 350Z; l. RTR Sprint 2 Flux w/ Porsche 911 GT3 RS; m. RTR Sprint 2 Flux w/ BMW M3; n. RTR SPRINT 2 SPORT; o. RTR Sprint 2 Flux w/ 2010 Chevrolet Camaro; p. RTR Sprint 2 Sport w/ 1969 Ford Mustang; q. Blitz Flux RTR; r. Sprint 2 Flux RTR with Mustang GT-R; s. Sprint 2 Flux; t. E Firestorm 10t Flux RTR; u. Cup Racer 1M Kit w/ BMW 2002; v. RTR Crawler King with Land Rover Defender 90; w. Blitz ESE; x. HB TCX; y. RTR Trophy 3.5 Buggy; z. RTR Trophy Truggy 4.6; aa. RTR Wheely King 4x4; and bb. Crawler King 1973 Ford Bronco. 21. Traxxas s remedy by civil action for infringement is provided by 35 U.S.C Prior to the filing of this action, Traxxas complied with 35 U.S.C. 287 by placing a notice of the 511 Patent on products it sells. 5

6 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 6 of 9 PageID #: Traxxas has been damaged as a result of HPI s infringing conduct. HPI is, therefore, liable to Traxxas in an amount that adequately compensates Traxxas for HPI s infringement, which, by law, cannot be less than a reasonable royalty, together with prejudgment and post-judgment interest and costs as fixed by this Court under 35 U.S.C HPI s infringement of the 511 Patent is willful and deliberate, making this case exceptional pursuant to 35 U.S.C. 285 and justifying treble damages under 35 U.S.C If it is determined that this case presents exceptional circumstances within the meaning of 35 U.S.C. 285, Traxxas requests that the Court award Traxxas all reasonable attorneys fees and costs incurred in this litigation, and pre-judgment and post-judgment interest thereon, pursuant to 35 U.S.C. 284 and 285. COUNT II INFRINGEMENT OF U.S. PATENT NO. 8,982, Traxxas realleges and incorporates by reference paragraphs 1-25 above as if fully set forth herein. 27. In violation of 35 U.S.C. 271(a), HPI has directly infringed, literally or under the doctrine of equivalents, and continues to directly infringe one or more claims of the 541 Patent by making, using, selling, or offering for sale in the United States, or by importing into the United States, protective enclosures that embody the invention claimed in the 541 Patent. 28. HPI manufactures and sells remote-control model vehicles that include protective enclosures to protect the radio control receivers in such vehicles. For example, HPI sells and offers for sale in the United States at least the following remote-controllable vehicle products, which include protective enclosures that infringe the 541 Patent, either literally or under the doctrine of equivalents: a. Desert Trophy; b. RTR Wheely King 4x4; 6

7 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 7 of 9 PageID #: 7 c. Crawler King 1973 Ford Bronco; d. Ken Block WR8 with Ford Fiesta H.FH.V.; e. Ken Block 2013 GRC WR8 Flux; f. WR8 Flux Ken Block 2014 Ford Fiesta; and g. RTR WR8 Flux Rally. 29. Traxxas s remedy by civil action for infringement is provided by 35 U.S.C Prior to the filing of this action, Traxxas complied with 35 U.S.C. 287 by placing a notice of the 541 Patent on products it sells. 31. Traxxas has been damaged as a result of HPI s infringing conduct. HPI is, therefore, liable to Traxxas in an amount that adequately compensates Traxxas for HPI s infringement, which, by law, cannot be less than a reasonable royalty, together with prejudgment and post-judgment interest and costs as fixed by this Court under 35 U.S.C HPI s infringement of the 541 Patent is willful and deliberate, making this case exceptional pursuant to 35 U.S.C. 285 and justifying treble damages under 35 U.S.C If it is determined that this case presents exceptional circumstances within the meaning of 35 U.S.C. 285, Traxxas requests that the Court award Traxxas all reasonable attorneys fees and costs incurred in this litigation, and pre-judgment and post-judgment interest thereon, pursuant to 35 U.S.C. 284 and 285. JURY DEMAND 34. Traxxas hereby requests a trial by jury pursuant to Rule 38 of the Federal Rules of Civil Procedure. PRAYER FOR RELIEF WHEREFORE, Traxxas respectfully requests that this Court enter a judgment in its favor and against HPI as follows: 7

8 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 8 of 9 PageID #: 8 1. A permanent injunction against HPI, enjoining HPI, its respective directors, officers, agents, employees, successors, subsidiaries, and assigns, and all persons acting in privity, concert, or participation with HPI, from making, using, selling, or offering for sale in the United States, or importing into the United States, any and all products embodying the patented inventions claimed in the Patents-in-Suit; 2. Damages for infringement of the Patents-in-Suit pursuant to 35 U.S.C. 281 and 284; 3. Enhanced damages for willful infringement of the Patents-in-Suit, pursuant to 35 U.S.C. 284; 4. Pre-judgment and post-judgment interest at the maximum legal rate; 5. Costs, expenses, and fees, including reasonable and necessary attorneys fees, pursuant to 35 U.S.C. 285; 6. Payment of costs of suit herein incurred pursuant to, inter alia, 35 U.S.C. 297(b)(1); and 7. All other relief to which Traxxas may be entitled at law or in equity, whether pled or unpled. 8

9 Case 2:15-cv JRG-RSP Document 1 Filed 07/10/15 Page 9 of 9 PageID #: 9 Dated: July 10, 2015 Respectfully Submitted, By: /s/ William E. Davis, III William E. Davis, III Texas State Bar No bdavis@bdavisfirm.com THE DAVIS FIRM, PC 213 N. Fredonia Street, Suite 230 Longview, Texas Telephone: (903) Facsimile: (903) Of Counsel: L. David Anderson Attorney-In-Charge Texas State Bar No danderson@wickphillips.com R. Casey O Neill Texas State Bar No casey.oneill@wickphillips.com Rusty O Kane Texas State Bar No rusty.okane@wickphillips.com WICK PHILLIPS GOULD & MARTIN, LLP 3131 McKinney Avenue, Suite 100 Dallas, Texas Telephone: (214) Facsimile: (214) ATTORNEYS FOR PLAINTIFF TRAXXAS LP 9