General Electric Company, et al. v. Wilkins, No. 1:2010cv00674 - Document 58 (E.D. Cal. 2010)
Court Description: MEMORANDUM DECISION Regarding Defendant's Motion to Dismiss 26 , signed by Judge Oliver W. Wanger on 10/7/2010. (Kusamura, W)
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General Electric Company, et al. v. Wilkins Doc. 58 1 2 3 4 UNITED STATES DISTRICT COURT 5 EASTERN DISTRICT OF CALIFORNIA 6 7 8 GENERAL ELECTRIC COMPANY, 9 Plaintiff, 10 1:10-cv-00674–OWW-JLT MEMORANDUM DECISION REGARDING DEFENDANT’S MOTION TO DISMISS (Doc. 26) v. 11 12 THOMAS WILKINS, Defendant. 13 I. INTRODUCTION. 14 15 Plaintiff General Electric Company(“Plaintiff”) proceeds with 16 an action against Defendant Thomas Wilkins (“Defendant”). On July 17 15, Defendant filed a motion to dismiss Plaintiff’s complaint. 18 (Doc. 26). 19 September 9, 2010. 20 September 21, 2010. Plaintiff filed opposition to the motion to dismiss on (Doc. 43). (Doc. 47). II. 21 Defendant filed a reply on FACTUAL BACKGROUND. 22 Plaintiff is a developer of energy technologies and the holder 23 of U.S. Patent Nos. 6,921,985 (“‘985 Patent”) and 6,924,565, 24 (“the’565 patent”). 25 asserting its rights in the ’985 patent in ongoing actions against 26 Mitsubishi Heavy Industries LTD, et al. (“MHI”) in both the United 27 States International Trade Commission and the U.S. District Court 28 for the Southern District of Texas (“the Actions”). (Complaint at 1-2). Plaintiff is currently (Complaint at 1 Dockets.Justia.com 1 2). MHI has employed Defendant as a consultant in the Actions and 2 has relied upon Defendant’s assertions to challenge Plaintiff’s 3 standing to bring the Actions as well as the enforceability of the 4 ’985 patent. (Complaint at 2). 5 Defendant is listed as one of seven inventors of the ‘565 6 patent and has asserted that he is an unnamed co-inventor of the 7 ’985 patent. 8 electrical 9 approximately April 1998 to May 2002. (Complaint at 2). 10 2002, of 11 Defendant became an employee of Plaintiff’s at 13000 Jameson Rd., 12 Tehachapi, California. 13 resigned from Plaintiff’s employ in December, 2002. (Complaint at 14 2). 15 (Complaint at 2). engineer Plaintiff by acquired Defendant was employed as an Enron the Wind assets Corp. (Complaint at 2). (“Enron”) Enron; at from In May that time, Defendant voluntarily Defendant’s job responsibilities while employed by Enron and 16 Plaintiff 17 testing of wind turbine generators. (Complaint at 4). 18 course of his work, Defendant was expected to improve and innovate 19 in 20 Defendant was expressly hired by Enron and Plaintiff to invent such 21 wind technology. 22 the included area of the wind design, turbine development, generators. installation (Complaint and In the at 4). (Complaint at 4). As a condition of his employment with Enron, Defendant signed 23 a Confidentiality and Inventions Agreement (“C&I Agreement”). 24 (Complaint at 4). 25 Defendant agreed “upon the Company’s request and without the need 26 for further consideration, to execute any and all documents and 27 take such actions which may be necessary in the Company’s judgment 28 to assign all rights to any Invention Idea to the Company and to The C&I Agreement provided, inter alia, that 2 1 obtain patent or other intellectual property protections for any 2 Invention Idea .” 3 Agreement, Defendant was obligated to assign any interest in the 4 ’985 and ’565 patents to Plaintiff. 5 (Complaint at 4). Under the terms of the C&I (Complaint at 4). Upon becoming an employee of Plaintiff, Defendant was required 6 to execute 7 Information Agreement (“EIPI Agreement”). (Complaint at 4). 8 EIPI Agreement provided, inter alia, that Defendant agreed “to 9 disclose and assign to the Company (or as the Company may direct) exclusive Employee The innovations, improvements, trade secrets and technical or business 12 information which [he] may solely or jointly develop, conceive, 13 reduce 14 employment.” 15 Agreement, Defendant was obligated to assign any interest in the 16 ’985 and ’565 patents to Plaintiff. 17 was also required to sign an acknowledgment that he was required to 18 comply with the policies described in the guide: “GE Policies. 19 Integrity: The Spirit the Letter of our Commitment” (“GE Policy 20 Guide”), which also specified Defendant’s obligations with respect 21 to the intellectual property in dispute. or author during (Complaint at 4). Plaintiff applied for the inventions, Proprietary 11 practice all and as to property, Innovation 10 22 its Plaintiff’s the discoveries, period of [his] Under the terms of the EIPI (Complaint at 4). ’565 Defendant (Complaint at 5). patent after Defendant 23 terminated his employment with Plaintiff. 24 Plaintiff requested that Defendant sign documents in the course of 25 the 26 Defendant refused. 27 an assignment expressly assigning the ’565 patent to Plaintiff, 28 despite Plaintiff’s request that he do so. prosecution of the application (Complaint at 3). 3 for (Complaint at 3). the ’565 patent, but Defendant has never signed (Complaint at 3). III. LEGAL STANDARD. 1 2 Dismissal under Rule 12(b)(6) is appropriate where the 3 complaint lacks sufficient facts to support a cognizable legal 4 theory. 5 (9th Cir.1990). 6 survive a 12(b) (6) motion, the pleading “does not need detailed 7 factual allegations” but the “[f]actual allegations must be enough 8 to raise a right to relief above the speculative level.” Bell Atl. 9 Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (2007). Mere To sufficiently state a claim to relief and 10 929 “labels and conclusions” or a “formulaic 11 recitation of the elements of a cause of action will not do.” Id. 12 Rather, there must be “enough facts to state a claim to relief that 13 is plausible on its face.” Id. at 570. In other 14 “complaint must contain sufficient factual matter, accepted as 15 true, to state a claim to relief that is plausible on its face.” 16 Ashcroft v. Iqbal, --- U.S. ----, ----, 129 S.Ct. 1937, 1949, 173 17 L.Ed.2d 868 (2009) (internal quotation marks omitted). words, the 18 The Ninth Circuit has summarized the governing standard, in 19 light of Twombly and Iqbal, as follows: “In sum, for a complaint to 20 survive a motion to dismiss, the nonconclusory factual content, and 21 reasonable 22 suggestive of a claim entitling the plaintiff to relief.” Moss v. 23 U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir.2009) (internal 24 quotation marks omitted). Apart from factual insufficiency, a 25 complaint is also subject to dismissal under Rule 12(b)(6) where it 26 lacks a cognizable legal theory, Balistreri, 901 F.2d at 699, or 27 where the allegations on their face “show that relief is barred” 28 for some legal reason, Jones v. Bock, 549 U.S. 199, 215, 127 S.Ct. inferences from that 4 content, must be plausibly 1 910, 166 L.Ed.2d 798 (2007). 2 In deciding whether to grant a motion to dismiss, the court 3 must accept as true all “well-pleaded factual allegations” in the 4 pleading under attack. Iqbal, 129 S.Ct. at 1950. A court is not, 5 however, “required to accept as true allegations that are merely 6 conclusory, 7 inferences.” Sprewell v. Golden State Warriors, 266 F.3d 979, 988 8 (9th Cir.2001). “When ruling on a Rule 12(b)(6) motion to dismiss, 9 if a district court considers evidence outside the pleadings, it 10 must normally convert the 12(b)(6) motion into a Rule 56 motion for 11 summary 12 opportunity to respond.” 13 907 (9th Cir. 2003). “A court may, however, consider certain 14 materials-documents 15 incorporated by reference in the complaint, or matters of judicial 16 notice-without converting the motion to dismiss into a motion for 17 summary judgment.” Id. at 908. unwarranted judgment, and 20 it must of give fact, the or unreasonable nonmoving party an United States v. Ritchie, 342 F.3d 903, attached to the complaint, documents IV. Discussion 18 19 deductions A. Defendant’s Position Defendant contends that Plaintiff’s action is barred by the 21 applicable statute of limitations. Defendant asks the court to 22 take judicial notice of a petition to the Patent Office filed by 23 Plaintiff in 2004, which indicates that Defendant refused to sign 24 an Inventor Declaration and Power of Attorney form in connection 25 with the patent application. 26 petition establishes that Defendant’s breach occurred when he 27 refused to sign the Inventor Declaration and Power of Attorney form 28 in 2004. Defendant argues that the patent 5 1 As discussed above, when the legal sufficiency of a 2 complaint's allegations is tested by a motion under Rule 12(b)(6), 3 review is limited to the complaint.” 4 Angeles, 250 F.3d 668, 688 (9th Cir. 5 As a general rule, a district court may not consider any material 6 beyond the pleadings in ruling on a Rule 12(b)(6) motion. 7 Rule 12(d)expressly provides that when: 8 E.g. Lee v. City of Los 2001) (quotation omitted). Id. matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by Rule 56. 9 10 11 12 Fed. R. Civ. P. 12(d) (emphasis added). 13 There are two exceptions to the requirement that consideration 14 of extrinsic evidence converts a 12(b)(6) motion to a summary 15 judgment motion. 16 consider material which is properly submitted as part of the 17 complaint. 18 the 19 authenticity 20 necessarily relies on them. 21 judicial notice of "matters of public record" pursuant to Federal 22 Rule of Evidence 201. Id. complaint, is Lee, 250 F.3d at 688. First, a court may If the documents are not physically attached to they not may be considered contested and Id. the if the plaintiff's Second, documents' complaint a court may take 23 Defendant seeks to rely on the judicial notice exception to 24 Rule 12(d) in presenting extrinsic evidence in support of his 25 motion to dismiss. 26 judicial notice of the patent petition, as it constitutes a public 27 record. 28 petition by one of Plaintiff’s attorneys, Paul Mendonsa, which Defendant contends that the court may take Defendant points to a declaration contained in the patent 6 1 states: 2 On February 11, 2004, I spoke with [Defendant] via telephone and [Defendant] informed me that he was not willing to sign the Inventor Declaration and Power of Attorney form fro [sic] the above-referenced patent application. 3 4 5 (Motion to Dismiss, Ex. 1, Mendonsa Dec. at 2). 6 Defendant, 7 establishes that Defendant breached his obligations under the 8 operative contracts in 2004. Mendonsa’s declaration in the According to patent petition 9 To the extent Plaintiff’s claim for breach is predicated 10 solely on Defendant’s refusal to “execute...documents... necessary 11 ...to obtain patent or other intellectual property protections,” 12 (Complaint at 4), statements contained in a judicially noticeable 13 document suggest that Plaintiff’s claim may be barred by the 14 statute 15 ambiguous with respect to the nature of Defendant’s alleged breach 16 or breaches, it is not possible to determine whether Plaintiff’s 17 entire action is time-barred. 18 DISMISSED. 19 B. of limitations. However, because the complaint is Accordingly, the complaint must be Leave to Amend 20 Defendant contends that leave to amend should not be granted 21 because “indisputable judicially noticeable facts establish that 22 GE had notice of its claims against Mr. Wilkins more than four 23 years before it filed the Complaint.” 24 Defendant’s contention is premised on a misunderstanding of the 25 scope of judicial notice. (Motion to Dismiss at 10). 26 Although judicial notice generally may be taken of Patent and 27 Trademark Office documents, e.g. Vitek Systems, Inc. v. Abbott 28 Laboratories, 675 F.2d 190, 192 n.4 (8th Cir. 1982), judicial 7 1 notice may not be taken of contested factual information contained 2 within such documents, see, e.g., NLRB v. Big Bear Supermarkets # 3 3, 640 F.2d 924, 926 n.1 (9th Cir. 1980) (declining to take 4 judicial notice of letters where the contents of the letters were 5 subject to reasonable dispute). 6 Defendant’s refusal to sign the Inventor Declaration and Power of 7 Attorney form in 2004 constituted a breach of Defendant’s all of 8 Plaintiff’s duties under the operative contracts. 9 Defendant’s assertion, the fact that Defendant “was not willing to 10 sign the Inventor Declaration and Power of Attorney form” does not 11 conclusively 12 contractual obligations in 2004. 13 Plaintiff 14 Defendant’s 15 Defendant’s unwillingness to sign the Inventor Declaration and 16 Power of Attorney may not have constituted a breach at all. 17 Further, to the extent that the operative contracts imposed duties 18 separate from the duty to sign patent documents, Plaintiff may be 19 able to amend the complaint to state breaches that occurred within 20 the limitations period. 21 contractual 22 examination of extrinsic evidence that is not subject to judicial 23 notice. 24 establish had failed assignment obligations that to Here, the parties dispute whether Defendant breached Contrary to all of his For example, to the extent that perform obligation a as condition of precedent February 11, to 2004, Whether Defendant breached all of his in 2004 cannot be determined absent Accordingly, Plaintiff is granted leave to amend. ORDER 25 For the reasons stated, IT IS ORDERED: 26 1) The complaint is DISMISSED, without prejudice; 27 2) Plaintiff shall lodge a formal order consistent with this 28 memorandum decision within five (5) days following electronic 8 1 service of this decision by the clerk. 2 an amended complaint within fifteen (15) days of the filing of 3 the order. 4 (15) days of receipt of the amended complaint. 5 IT IS SO ORDERED. 6 Dated: hkh80h Plaintiff shall file Defendant shall file a response within fifteen October 7, 2010 /s/ Oliver W. Wanger UNITED STATES DISTRICT JUDGE 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 9
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