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Microsoft is charged with patent infringement, something that

necessarily depends on the existence of a valid patent. After

all, both infringement and validity must be proved by Performance

to justify its recovery under the Complaint. Hence it is

difficult to understand just what (other than extra paper) is

added to the case by a counterclaim that seeks declarations of

non-infringement and invalidity of the patent in issue.1

Accordingly the First Defense is stricken. This Court will

leave it to Microsofts counsel to either explain the need for

the present counterclaim or to file an amended pleading to take

its place.

_________________________________Milton I. ShadurSenior United States District Judge

Date: January 11, 2010

To the extent that Microsoft seeks (as it does) an1

award of attorneys fees and expenses on the premise that thisaction is exceptional, that might well take the form of anaffirmative defense or, if that seems inappropriate, a one- ortwo-paragraph counterclaim without the added mirroring of thedenials already set out in the Answer.

2

Case 1:09-cv-06884 Document 29 Filed 01/11/10 Page 2 of 2

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IN THE UNITED STATES DISTRICT COURTFOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

PERFORMANCE PROXYRESEARCH, LLC

Plaintiff,

vs.

MICROSOFT CORPORATION

Defendant.

CIVIL ACTION NO. 1:09-CV-06884

JURY TRIAL DEMANDED

Hon. Judge Shadur

MICROSOFTS MOTION TO CLARIFY MEMORANDUM ORDER

Defendant Microsoft Corporation (Microsoft) respectfully moves for clarification of

the Courts Memorandum Order dated January 11, 2010, which struck Microsofts First Defense

(Non-Infringement of the Asserted Patent) from its Original Answer and invited further

explanation regarding the necessity of Microsofts counterclaims for invalidity and non-

infringement. (Dkt. 29).

Regarding the invalidity counterclaim, Microsoft has pleaded invalidity as an affirmative

defense as required by the Patent Statute. 35 U.S.C. 282. The present circumstances in this

case, therefore, do not require this position to also be pleaded as a counterclaim.

However, Microsoft files this motion to address the possible necessity of its non-

infringement counterclaim. Microsoft pleaded non-infringement as a defense in its Original

Answer in view ofState Farm Mutual Auto Insurance Co. v. Riley, 199 F.R.D. 276, 279 (N.D.

Ill. 2001), Federal Rule of Civil Procedure 8(b)(5), and the Patent Statute, which requires that

non-infringement shall be pleaded. See 35 U.S.C. 282. Additionally, Microsoft has found at

least one court in this jurisdiction holding that non-infringement is a defense that must be

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2

affirmatively pleaded or else is waived. See Para Gear Equipment Co. Inc. v. Square One, No.

04-cv-601, Order dated September 2, 2008 (Brown, J.) (attached as Exhibit A). Specifically, the

Para Gearcourt granted summary judgment in favor of the plaintiff, holding that the defendant

effectively conceded infringement because, despite its denial of the plaintiffs allegations of

infringement, the defendant did not separately plead non-infringement as a defense and its

pleadings did not contain a live counterclaim for non-infringement. Id. at 2-4 (It is not enough

merely to deny the patentees allegations of infringement.). To avoid similarly conceding

infringement, therefore, Microsoft not only denied Plaintiffs infringement allegations, but also

pleaded non-infringement both as its First Defense and as a counterclaim.

Microsofts aim is to sufficiently preserve (and not waive) its non-infringement defense

in this case. Based on the authorities cited in this Motion, it appears that one possible way to

preserve the non-infringement defense is to plead it as a counterclaim. Out of an abundance of

caution, therefore, Microsoft seeks clarification from the Court on how to properly preserve the

defense, and will file an amended pleading in accordance with the Courts further instructions.

Dated: January 21, 2010 Respectfully Submitted,

s/ Walter Jones, Jr.

B. Trent Webb (admittedpro hac vice)

Patrick A. Lujin (admittedpro hac vice)

Michelle L. Marriott (pro hac vice filed)

Mary Jane Peal (ARDC No. 6287070)SHOOK, HARDY & BACON LLP

2555 Grand Boulevard

Kansas City, Missouri 64108(816) 474-6550

(816) 421-5547 Facsimile

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3

Walter Jones, Jr. (ARDC No. 1365665)Uma Chandrasekaran (ARDC No. 6281690)

PUGH, JONES, JOHNSON & QUANDT, P.C.

180 North LaSalle Street, Suite 3400Chicago, Illinois 60601

(312) 768-7800(312) 768-7801 FacsimileAttorneys For Defendant Microsoft Corporation

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4

CERTIFICATE OF SERVICE

I, Walter Jones, Jr., an attorney, certify that I shall cause to be served a copy of

Microsofts Motion to Clarify Memorandum Order upon the following individual(s), by

deposit in the U.S. mail box at 180 North LaSalle Street, Chicago, Illinois 60601, postage

prepaid, same-day personal delivery by messenger, Federal Express overnight delivery, facsimiletransmitted from (312) 768-7801, or Case Management/Electronic Case Filing System(CMECF), as indicated below on January 21, 2010

CM/ECF

Facsimile/___ PagesFederal Express

U.S. Mail

Messenger

Raymond P. Niro

Dean D. Niro

Frederick Christopher Laney

Joseph Albert Culig

Niro, Scavone, Haller & Niro, Ltd.

181 West Madison StreetSuite 4600

Chicago , IL 60602

s/ Walter Jones, Jr.

Walter Jones, Jr.

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