U.S. Water Servs., Inc. v. ChemTreat, Inc., No. 14-3057 (8th Cir. 2015)
Annotate this CaseIn April 2011, while its patent application was pending with the USPTO, U.S. Water Services, which “sell[s] water treatment and purification equipment, materials, and services,” especially “to ethanol process technologies,” sued its competitor, ChemTreat, for misappropriation of trade secrets. In October 2011, the USPTO issued the 244 patent covering a method to reduce the formation of insoluble scale deposits during the production of ethanol using enzyme, phytase, in its “pHytOUT® system.”Three days before U.S. Water and ChemTreat settled the misappropriation claim, ChemTreat filed counterclaims requesting declaratory judgments of noninfringement and invalidity of the 244 patent. The suit was filed before the Leahy-Smith America Invents Act, 125 Stat. 284, took effect, so the counterclaims independently did not establish appellate jurisdiction for the Federal Circuit. The district court granted ChemTreat summary judgment as to the noninfringement counterclaim and dismissed the invalidity counterclaim. The Eighth Circuit affirmed. Evaluating the “totality of [the] circumstances,” the district court did not err in finding the misappropriation action, together with U.S. Water’s statements to its customers and supplier, produced an objective, “reasonable apprehension of suit,” and did not err in concluding declaratory judgment subject matter jurisdiction existed. The decision did not constitute an advisory opinion.
Court Description: Riley, Author, with Murphy and Melloy, Circuit Judges] Civil case - Trade Secrets. The district court did not err in finding the misappropriation of trade secrets action, together with plaintiff's statements to its customers and suppliers, produced an objective, reasonable apprehension of suit and the district court did not err in concluding it had declaratory judgment action jurisdiction over the counterclaim requesting declaratory judgments of noninfringement and invalidity of a patent; the district court's decision was not a advisory opinion; Chem Treat's motion for attorneys' fees is denied as the counterclaim defendants' appeal was not frivolous.
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