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Millepede Marketing Ltd. v. Harsley

United States District Court, District of Columbia

March 7, 2013

MILLEPEDE MARKETING LIMITED, Plaintiff,
v.
Andrew J. HARSLEY, and Rapstrap Limited, Defendants.

Page 110

[Copyrighted Material Omitted]

Page 111

Peter N. Fill, Steven F. Meyer, New York, NY, Matthew T. Eggerding, for Plaintiff.

Katherine Pauley Barecchia, Charles R. Wolfe, Jr., Washington, DC, for Defendants.

MEMORANDUM OPINION

BERYL A. HOWELL, District Judge.

This case involves a dispute among United Kingdom parties over the ownership of a United States patent for the design of a flexible " tie strip" used apparently to close items such as garbage bags. The plaintiff, Millepede Marketing Limited, a United Kingdom company, brought this action against its former employee, defendant Andrew J. Harsley, a citizen and current resident of the United Kingdom, and his privately-held company, Rapstrap Limited (" Rapstrap" ), a United Kingdom company, alleging in a two-count complaint that defendant Harsley breached an implied contract with, and fiduciary duty to, the plaintiff when he failed to assign all right, title, and interest in inventions disclosed and claimed in United States Patent No. 7,704,587 (" '587 Patent" ) for " tie strips," to the plaintiff, and instead assigned the ownership rights to his newly formed company, Rapstrap. Complaint (" Compl." ), ECF No. 1. Both of the defendants have moved, pursuant to Federal Rule of Civil Procedure 12(b)(1), to dismiss this action based on the plaintiff's failure to establish the subject matter jurisdiction of this Court. Def. Harsley's Mot. to Dismiss, ECF No. 17; Def. Rapstrap's Mot. to Dismiss, ECF No. 14.

For the reasons stated below, the defendants' motions are granted due to the plaintiff's failure to establish that this Court has subject matter jurisdiction under 28 U.S.C. § 1338(a). The plaintiff also argues that this Court has common law equity jurisdiction over these claims, but this is not a legally viable basis for the exercise of jurisdiction in the instant case. Pl.'s Opp'n to Defs.' Motions to Dismiss

Page 112

(" Pl.'s Opp'n" ), ECF No. 19, at 10. As explained in more detail below, this case must be dismissed. [1]

I. BACKGROUND

A. Defendant Harsley's Assignments of Patent Rights

On June 24, 1994, defendant Harsley filed a patent application in the United Kingdom, serial no. 9412759 (" 1994 UK Patent Application" ), for an " integrally formed tie strip made of a semi-rigid resiliently bendable material." Compl. ¶ 12. The next year, in 1995, defendant Harsley and another person founded Millepede Cable Ties Limited, and defendant Harsley assigned all of his ownership rights in the 1994 UK Patent Application to that newly created company. Id. ¶¶ 13-14.

Later the same year, on June 23, 1995, defendant Harsley filed International Patent Application No. PCT/GB95/01487 (" 1995 International Patent Application" ), which claimed priority to the 1994 UK Patent Application. [2] Id. ¶ 15. Again, defendant Harsley assigned all the ownership rights in the 1995 International Patent Application to Millepede Cable Ties Limited in an agreement dated September 10, 1995. Id. ¶ 16. In this agreement, defendant Harsley also assigned " ‘ right, title, and interest in the Invention throughout the world; ’ and ‘ the right to apply for patent or other protection in respect of the Invention in all parts of the world whether by way of national or supranational patents and whether or not claiming the priority date(s) of the United Kingdom Application on the International Application.’ " Id.

On March 3, 1997, defendant Harsley filed Patent Application serial no. 08/765,560 (" 1997 U.S. Patent Application" ) in the United States Patent and Trademark Office. Id. ¶ 17. The plaintiff alleges that this application claimed priority to both the 1994 UK Patent Application and the 1995 International Patent Application. Id. The next year, on August 25, 1998, defendant Harsley assigned all of his ownership rights in the 1997 U.S. Patent Application to Millepede Cable Ties Limited. Id. ¶ 18. Shortly after this assignment was made, this application issued as United States Patent No. 5,799,376 (" '376 Patent" ) on September 1, 1998. Id. ¶ 17.

B. Creation of Millepede International Limited

In February 2001, Millepede International Limited was formed " to acquire patents and other intellectual property rights— relating both to the Millepede Mille-Tie fastener designs and to Continuous Injection Moulding technology— from Millepede Cable Ties Limited." Id. ¶ 19. Millepede Cable Ties Limited assigned all its ownership rights in the '376 patent to Millepede International Limited on September 4, 2001. Id. ¶ 20. Defendant Harsley was the single largest shareholder of Millepede International Limited and " part of the ‘ senior management’ of Millepede International Limited, ‘ Research & Development, Millepede Marketing Ltd. (UK)’ ." Id. ¶ 19.

Page 113

The plaintiff Millepede Marketing, a majority-owned subsidiary of Millepede International Limited, hired defendant Harsley as " Technical Director" to " invent improvements on the Millepede Mille-tie depicted in the ' 376 patent." Id. ¶¶ 21-23. Defendant Harsley was employed by the plaintiff in this capacity and receiving " a regular salary ... from at least September 30, 2001 to March 31, 2004." Id. ¶¶ 22, 30.

C. Disputed United States Patent

On June 10, 2003, while still employed by the plaintiff, defendant Harsley filed United Kingdom Patent Application No. 0313319.6 (" 2003 UK Patent Application" ), " which was directed to a very narrow improvement to the Millepede Mille-Tie depicted in the '376 patent." Id. ¶ 23. Less than one year later, on April 30, 2004,[3] defendant Harsley ceased being employed by the plaintiff, although he apparently continued to be a majority shareholder in the plaintiff's parent company. Id. ¶¶ 24, 37.

Nineteen months after he left the plaintiff's employment, on December 9, 2005, defendant Harsley filed patent application serial no. 10/560,137 (" 2005 U.S. Patent Application" ) in the United States Patent and Trademark Office. Id. ¶ 25. This patent application claimed priority to the 2003 UK Patent Application, " as they are both directed to the same invention." Id. In the 2005 U.S. Patent Application, defendant Harsley claimed that " the notch 15 in the tie strip ... was the patentable improvement over the tie strip disclosed in the earlier '376 patent." Id. ¶ 26. This application issued in defendant Harsley's name as United States Patent No. 7,704,587 (" '587 Patent" ) on April 27, 2010. Id. ¶¶ 25, 27. Defendant Harsley assigned his ownership rights to the '587 patent to defendant Rapstrap. Id. ¶ 28.

The plaintiff claims the notch, the " patentable improvement" in the ' 587 Patent, was " invented by [the defendant], by himself or in collaboration with others, on or before June 10, 2003, while employed by Millepede Marketing using tools and dies, and other resources, ultimately paid for by Millepede Marketing." Id. ¶ 31.

D. District Court Proceedings

On April 27, 2012, the plaintiff filed a Complaint against the defendants, Andrew Harsley and Rapstrap, in this Court alleging that (1) defendant Harsley breached an implied-in-fact contract requiring the assignment of his rights in the invention claimed in the '587 patent to the plaintiff, as his then employer, id. ¶¶ 32-33 (Count I); and (2) defendant Harsley, as the single largest shareholder of Millepede International Limited and as Technical Director of the plaintiff, breached a fiduciary duty by failing to assign his interest in the '587 patent to the plaintiff. Id. ¶¶ 37-38 (Count II). As a remedy, the plaintiff seeks " a declaration that ... the '587 patent is the property of Millepede Marketing and an order requiring Harsley and/or Rapstrap to execute an assignment to Millepede Marketing of all equitable and legal rights to the '587 patent." Id. ¶ 2.

Both defendants have moved, under Federal Rule of Civil Procedure 12(b)(1), to dismiss the complaint for failure to establish the subject matter jurisdiction of this Court. Def. Harsley's Mot. to Dismiss, ...


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